HDFC Bank Ltd. share price target

Net Interest Income (NII) for Q3FY25 stood at INR 306,533 Mn, a growth of 7.7% YoY/ 1.8% QoQ, which is aligned with the business momentum. NII was in line with our estimates. Pre-Provision Operating Profits (PPOP) grew 5.7% YoY (+1.2% QoQ) to INR 250,004 Mn, with operating income growing by 6.3% YoY.

We maintain our BUY recommendation on the stock.

CD continued to decline, while advances growth is likely to be lower than system for FY25, in line for FY26 and faster in FY27

HDFC Bank reported a slight miss (of 2%) on PAT, which came in at Rs167bn/1.8% RoA, primarily due to slower credit growth and higher provisions. Deposit growth remains healthy at 16% YoY/2.5% QoQ (up by Rs0.6trn QoQ), but credit growth fell to a new low of 3% YoY as the bank focused on LDR management (down by160bps QoQ to 98%).

Q3FY2025 numbers were broadly in line given the transition period. NII at Rs. 30,653 crore (up 8% y-o-y/2% q-o-q) in line with estimates, led by stable NIM of ~3.4% (marginally declined by 3 bps q-o-q led by interest income reversals on NPA agri portfolio) and net loan growth of ~1% q-o-q.

HDFC Bank (HDFCB) reported 3QFY25 net profit of INR167.4b (2.2% YoY growth, in line).NII grew 7.7% YoY to INR306.5b (in line). NIMs contracted 3bp QoQ to 3.43%.

HDFC Bank’s key focus remains on higher retail deposit mobilisation. The bank intends to bring down its CD ratio at a faster pace to 85-87% level; and as and when the credit cycle turns over the next couple of quarters, the bank wants to be well-positioned to capture the incremental growth that it has seen in the pre-merger period

HDFCB’s management reiterated its unwavering focus on customer satisfaction, arresting employee attrition, upgrading tech, and reducing regulatory friction.

HDFC Bank has largely outperformed its large private peers in the recent past, primarily on account of its relatively better margin, asset quality outcomes amid rising asset quality noises in unsecured loans.

Net Interest Income (NII) for Q2FY25 stood at INR 301,139 Mn, a growth of 10.0% YoY/ 0.9% QoQ. NII was in line with our estimates (-0.6% deviation).

We maintain our BUY recommendation on the stock

HDFC Bank reported a 3% PAT beat at Rs168bn/1.9% RoA, primarily due to stable margins, contained opex, and provisions.

HDFC Bank (HDFCB) reported steady performance in 2QFY25, with net earnings of NR168.2b (~3% beat)

HDFC Bank reported broadly in-line performance with strong deposit growth in Q2FY2025. Given the transition period, management’s relentless focus is towards balance sheet management and stability in return ratios.

HDFC Bank’s business update for Q2FY2025 indicated that deposit mobilisation (up 15.1% y-o-y/5.1% q-o-q) has been strong (above estimates), led by term deposits(19.3% y-o-y/6.7% q-o-q).

HDFC Bank (HDFCB)’s Annual Report emphasizes the institution's commitment to achieving sustainable growth over the medium term as it continues to invest in strengthening both its physical infrastructure and digital prowess.

Net Interest Income (NII) for Q1FY25 stood at INR 298,371 Mn, a growth of 26.4% YoY/ 2.6% QoQ. NII was in line with our estimates.