Buy HDFC Bank; target of Rs 2000: Prabhudas Lilladher

Prabhudas Lilladher is bullish on HDFC Bank has recommended buy rating on the stock with a target price of Rs 2000 in its research report dated January 17, 2024.

Broker Research

January 17, 2024 / 12:21 IST

Buy

26 Aug, 2025 12:21

Volume

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Prabhudas Lilladher's research report on HDFC Bank

HDFCB saw stable quarter; NIM (in-line) improved by 7bps QoQ to 3.73% as excess liquidity was utilized to retire wholesale deposits, thereby increasing LDR by ~3% QoQ. Loan growth at 4.9% QoQ was led by CRB, housing and CC. With system liquidity in shortfall and peak LDR at 77.4%, deposit growth should be faster for current loan momentum to sustain, failing which system loan accretion should reduce in FY25/26E, compressing LDRs. Factoring a 15% CAGR for HDFCB, we trim loan growth by 1% in FY25/26E which would impact NIM by 4/5bps. This could be partly offset by lower opex given softer deposit requirement; our core PAT reduces by 2%/4%.

Outlook

While falling LDR could pressurize NIM, bank would focus on (1) controlling deposit cost and (2) improving share of CASA and higher yielding retail. Maintaining multiple at 2.7x, we revise TP to Rs2,000 from Rs2,025. Retain ‘BUY’.

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