HDFC Bank share price rises for 7th consecutive session; brokerages upbeat on Q4 update

HDFC Bank share price continued to witness buying interest on Friday, April 5, following the private lender's March quarter business updates. The stock has been gaining in the recent past after a subdued performance.

Nishant Kumar
Updated5 Apr 2024, 09:35 AM IST
HDFC Bank share price has seen decent traction in the recent past.
HDFC Bank share price has seen decent traction in the recent past. (Pixabay)

HDFC Bank share price continued to witness buying interest on Friday, April 5, following the private lender's March quarter business updates which showed impressive growth in deposits and a decline in the loan-to-deposit ratio. Rising for the seventh consecutive session, HDFC Bank share price opened at 1,543, up about one per ent against its previous close of 1,527.90 on BSE.

Several top brokerage firms expressed their positive views on HDFC Bank stock after the bank's Q4 business update, highlighting better-than-expected deposit growth during the March quarter.

As per CNBC-TV18, Macquarie maintained an 'outperform' view on the stock with a target price of 2,000 and said the bank's Q4 updates show consolidation strategy is playing out well. Macquarie said the decline in corporate loan growth and LDR (loan-to-deposit ratio) are excellent outcomes while deposit growth is a positive surprise. Macquarie believes the stock is available at attractive valuations and one should add it, CNBC-TV18 reported.

HSBC maintained a buy call on the stock with a target price of 1,750, citing HDFC Bank's Q4 deposit performance was above Street estimates while a slowdown in loan growth and the reduction in LDR were in line with expectations. Morgan Stanley maintained an overweight view of the stock with a target price of 1,900, CNBC-TV18 reported.

HDFC Bank share price has been witnessing decent gains in the recent past after a year of subdued performance. The stock declined about 10 per cent in FY24 while the equity benchmark Sensex jumped about 25 per cent.

Meanwhile, the bank will announce its financial results for the fourth quarter of FY24 on April 20. The board of directors of the private lender will meet on Saturday, April 20, to approve HDFC Bank's Q4 results.

Also Read: HDFC Bank Q4 Result: Private lender to announce Q4 earnings, dividend on April 20

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HDFC Bank Q4 business update

In an exchange filing on Thursday, April 4, India's largest private lender said its gross advances in Q4FY24 rose 55.4 per cent year-on-year (YoY) and 1.6 per cent quarter-on-quarter (QoQ) to nearly 25,08,000 crore.

The bank's domestic retail loans grew by around 108.9 per cent YoY and around 3.7 per cent QoQ while its commercial and rural

banking loans grew by around 24.6 per cent YoY and around 4.2 per cent QoQ, as per the lender's exchange filing.

Its corporate and other wholesale loans (excluding non-individual loans of the erstwhile HDFC Limited) grew by around 4.1 per cent YoY but declined by 2.2 per cent QoQ.

Further, the deposits figure stood at 23,80,000 crore as of March 31, 2024, registering a growth of around 26.4 per cent YoY and 7.5 per cent QoQ. Retail deposits grew by around 27.8 per cent YoY and around 6.9 per cent QoQ. Wholesale deposits grew by around 19.4 per cent YoY and around 10.9 per cent QoQ, HDFC Bank said.

The bank’s CASA deposits aggregated to approximately 9,09,000 crore as of March 31, 2024, up about 8.7 per cent YoY and around 8.8 per cent QoQ. Retail CASA grew by around 8.8 per cent YoY and 6.3 per cent QoQ. The bank’s CASA ratio

stood at around 38.2 per cent as of March 31, 2024, as compared to 44.4 per cent as of March 31, 2023, and 37.7 per cent as of December 31, 2023, according to HDFC Bank's exchange filing.

Moreover, in a separate exchange filing post market hours on Thursday, April 4, the lender said it had sold about a 3 per cent stake in Indraprastha Medical Corporation through the secondary market route on NSE in a cash consideration of 55.46 crore. After the divestment of its stake, HDFC Bank's shareholding in Indraprastha now stands at 2.45 per cent.

"We wish to inform you that out of 50,31,897 equity shares of 10 each held by HDFC Bank as of February 28, 2024, in Indraprastha Medical Corporation Limited, the bank has sold 27,81,897 shares (representing 3.03 per cent of the share capital of Indraprastha)," said HDFC Bank.

FII ownership declines in Q4

Meanwhile, the shareholding data for HDFC Bank at the end of March 2024 also showed that there was a decline in ownership by foreign institutional investors (FII) during the March 2024 quarter.

Also Read: HDFC Bank: FII ownership declines to 47.8% in the March' 2024 quarter from 52.3% at the end of December'2023 quarter.

The FII ownership in HDFC Bank as of the March 2024 quarter at 47.83 per cent, down from 52.39 per cent in the December 2023 quarter. 

This is leading to expectations that there may be some balancing and fresh emerge from new foreign investors to compensate for the gap that has been created by reduced FII stakes in HDFC Bank and the requirement to meet the weightage in the MSCI index.

Also Read: ‘Billions of dollars': What Helios Capital's Samir Arora estimates after FIIs reduce shareholding in HDFC Bank

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Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.

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First Published:5 Apr 2024, 09:35 AM IST
HomeMarketsStock MarketsHDFC Bank share price rises for 7th consecutive session; brokerages upbeat on Q4 update

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