19 hours ago
HDFC Bank Ltd. shares are in focus after multiple analysts are bullish on the stock post its fourth quarter results.
Brokerage firms UBS, Jefferies and Nuvama have a "buy" rating on the stock, with an upside of up to 23% from its previous closing price of ₹1,905.8 apiece. The brokerages have price targets of ₹2,250, ₹2,340 and ₹2,190 per share, respectively.
Meanwhile, brokerages CLSA and Macquarie have "outperform" ratings on the stock, with an upside of up to 21% from its previous closing price. CLSA has a price target of ₹2,200 per share and Macquarie's target stands at ₹2,300.
BNP Paribas has the highest price target on the street for HDFC Bank at ₹2,660.
UBS said the lender's fourth quarter profit and tax (PAT) and pre-provision operating profit (PPOP) were a marginal beat on expectations, but its net interest margin was a positive.
The brokerage is more confident on HDFC Bank's growth outlook given the improved system liquidity and has hence increased its earnings per share (EPS) estimates for FY26/27 and expects around 14% return on equity (RoE) during financial year 2027.
Jefferies said HDFC Bank's fourth quarter profit of ₹17,600 crore was ahead of estimates, aided by a pick-up in loan growth and better margins.
With healthy deposit growth and majority of the loan-to-deposit ratio correction done, it expects HDFC Bank's credit growth improvement in FY26 and FY27 to be on track.
It said better cross-sells and stable credit costs will aid core profits, but rate cuts will have interim drag on the net interest margin. Therefore, it has cut the FY26-27 earnings per share (EPS) estimate by 2-4%.
Nuvama said HDFC Bank reported a strong fourth quarter, with a beat on core net interest margin. Its core PPOP grew 10% from the previous year and 2% from the previous quarter and its slippage decreased 15% sequentially.
It added that HDFC Bank's management expects deposit growth to remain strong even amid rate cuts and has guided for a smaller improvement in loan-to-deposit ratio compared to the financial year 2025.
CLSA said HDFC Bank reported a decent fourth quarter with PAT beat of 2%-3%, adjusted for one-offs.
While the preceding four quarters were weak, the bank has finally picked-up loan growth and reiterated its intention to grow at least in-line with the market in FY26, CLSA said.
Lastly, Macquarie said HDFC Bank's March quarter PAT was in line with estimates. It said lower other income was offset by higher margins.
It said the lender's growth is in-line with system levels and its credit costs to remain stable.
Macquarie said it has maintained its "outperform" rating given the potential for return on assets improvement over the next two years driven by net interest margin expansion.
Of the 48 analysts that have coverage on HDFC Bank post its Q4 results, 44 have a "buy" rating, while four have a "sell" rating.
HDFC Bank shares ended the previous session nearly 1.5% higher. The stock has gained 6.9% this year, so far.
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