Sharekhan has given Buy recommendation for Housing Development Finance Corporation recommended buy rating on the stock with a target price of Rs 3589 in its research report with a target price of Rs. 3589 in its research report issued on Dec 09, 2021

Sharekhan’s research report on Housing Development Finance Corporation

We believe HDFC is the strongest player in housing finance space and better-placed among all its peers with a robust liability franchise, healthy balance sheet with growth levers. HDFC has consistently performed well as compared to its peers across business cycles. Better affordability and a change in housing needs post the pandemic, make HDFC a key beneficiary of changing sector dynamics. We expect the company’s loan book to witness strong growth going ahead with individual loan book to remain healthy for the company; on the asset quality front, HDFC has been able to maintain its GNPAs better than its peers (September GNPAs were at 2% with restructured loans constituting 1.4% of loan book).

Outlook

We re-iterate a Buy on HFDC with a SOTP based PT of Rs. 3,589. At CMP, HDFC trades at 3.9x of FY23E P/BV. The stock has corrected by 14% from the highs and touched a low of Rs. 2,656.

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