YES Securities has given Buy recommendation for HDFC Bank with a target price of Rs. 1830 in its research report issued on Oct 15, 2022

YES Securities’ research report on HDFC Bank

While management stopped short of providing margin guidance, they conceded some of the sequential expansion was transient: Management stated that there is a lead-lag effect in terms of rise in loan and deposit interest rates, leading to expansion in margin. On the other hand, they also added that retail lending, which is higher-margin than wholesale lending, has picked up for the bank over a period of time. Furthermore, the penetration of the customer base in terms of term deposits is just 14-15%, which implies that HDFCB may not have to woo rate-shoppers with unduly high TD rates


We reiterate BUY rating on HDFCB with a revised price target of Rs 1830: We value the standalone bank at 2.7x FY24 P/BV for an FY23E/24E/25E RoE profile of 14.4/14.5/15.4%. We assign a value of Rs 229 per share to the subsidiaries, on SOTP.

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