HDFC Bank’s share increased to a record high on Monday as the stock was trading at Rs 1,715 pe share, up about 2 per cent.
On Saturday, the bank reported over 17 per cent year-on-year growth in net profit in the second quarter of FY22 at Rs 8,834 crore as compared to Rs 7,513 crore during the same quarter last year.
What brokerages houses are saying:
The bank continues to deliver strong business growth versus peers, resulting in market share gains. This was led by a healthy pickup in the retail segment, while commercial and rural banking continues to remain robust, reported Mint.
High provision coverage and contingent provision buffer provide comfort on asset quality. Pick up in loan growth particularly retail would aid NII and margins which would drive profitability. The brokerage house has maintained its Buy rating on the stock with a revised target price of Rs 2,000 per share.
It has maintained a ‘Buy' rating on India's largest private lender's stock. They have also increased the target price to Rs 1,955 from earlier of Rs 1,818. Demand resolution is back to pre-covid levels and recoveries are encouraging. Bank is building digital and franchise capabilities to capture growth opportunities. Cumulative provisioning is equivalent to 2.2 per cent of advances against 2.9 per cent of stress pool.
Balance sheet capitalisation remains strong with tier-I ratio of 18.7 per cent. The brokerage house remains sanguine about the bank’s growth prospects given that it is taking multiple measures to capture emerging opportunities in commercial/rural and retail banking. It has maintained BUY on the stock with a TP of Rs 1,962.