Geojit's research report on HDFC Bank
Incorporated in August 1994, HDFC Bank provides corporate/retail banking and custodial services and is also involved in treasury and capital markets. In addition, it offers project advisory services and capital market products, including GDR and currency bonds. Net interest income (NII) rose 20.5% YoY on account of strong growth in advances. Net interest margin (NIM) remained flat at 4.3% QoQ. Pre-provision operating profit (PPOP) increased 20.6% YoY, while PAT rose 29.1% to Rs. 12,370cr owing to lower provisioning. HDFC Bank has replaced HDFC Limited (‘HDFC’) in MSCI Global Standard and FTSE All-World indices from 13 July 2023. Growth in advances and deposits remain strong, with renewed focus on retail segment. The bank remains well capitalised, with a diversified loan book and stable asset quality which should drive long-term growth. We retain our BUY rating on the stock, with a revised target price of Rs. 1,964 based on 2.9x FY25E BVPS.
Outlook
We expect earnings to grow at healthy 19% CAGR over FY23-25E. We reiterate our BUY rating on the stock with a revised target price of Rs. 1,964 based on 2.9x FY25E BVPS.
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