Hdfc Bank (HDB) AI Stock Analysis

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Hdfc Bank

(NYSE:HDB)

Rating:69Neutral

Price Target:

$81.00

▲(14.73% Upside)

HDFC Bank's overall stock score is driven by strong financial performance and stable long-term technical indicators. However, short-term technical weakness and valuation concerns, along with mixed earnings call sentiment, moderate the score. The bank's robust revenue growth and strategic initiatives are significant positives, but challenges in cash flow efficiency and margin pressures need addressing.

Positive Factors

Financial Performance

Net profit surpassed expectations, indicating strong financial performance.

Loan Growth

HDFC Bank is expected to continue loan growth in the consumer space due to a well-managed mortgage base.

Merger Synergies

Synergies from the merger with HDFC Limited are expected to outweigh execution risks, enhancing overall value.

Negative Factors

Asset Quality

Asset quality deteriorated as gross NPA ratio rose to 1.42%.

Earnings Risk

The key risks include a deterioration in asset quality and weaker than expected earnings due to slower loan growth.

Loan-to-Deposit Ratio

High loan-to-deposit ratio is a near-term concern, though longer-term synergies are positive.

Hdfc Bank (HDB) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$167.34B

Dividend Yield0.18%

Average Volume (3M)1.67M

Price to Earnings (P/E)43.4

Beta (1Y)0.32

Revenue Growth2.48%

EPS Growth0.37%

CountryUS

Employees214,521

SectorFinancial

Sector Strength77

IndustryBanks - Regional

Share Statistics

EPS (TTM)0.96

Shares Outstanding2,559,013,200

10 Day Avg. Volume1,795,033

30 Day Avg. Volume1,670,550

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)0.00

Price to Sales (P/S)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap2.68

Enterprise Value/Revenue0.14

Enterprise Value/Gross Profit0.20

Enterprise Value/Ebitda0.61

Forecast

1Y Price Target

$82.00

Price Target Upside16.15% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

Hdfc Bank Business Overview & Revenue Model

Company DescriptionHDFC Bank (HDB) is one of India's leading private sector banks, providing a wide range of banking and financial services to individual and corporate customers. Established in 1994, the bank operates in various sectors including retail banking, wholesale banking, treasury operations, and other financial services. Its core offerings encompass personal banking products such as savings accounts, fixed deposits, loans, insurance, and investment services, as well as corporate banking solutions including working capital finance, trade finance, and cash management services.

How the Company Makes MoneyHDFC Bank generates revenue primarily through interest income from loans and advances, which constitute a significant portion of its earnings. The bank offers various loan products like personal loans, home loans, auto loans, and business loans, charging interest on these loans. Additionally, it earns income from fees and commissions related to services such as account maintenance, transaction processing, and investment products. The bank also generates revenue from its treasury operations, which involve trading in government securities, foreign exchange, and derivatives. Significant partnerships with financial institutions, technology firms, and payment service providers further enhance its product offerings, contributing to its overall earnings. Overall, its diverse portfolio of financial products and services, combined with a strong customer base, plays a critical role in driving the bank's profitability.

Hdfc Bank Earnings Call Summary

Earnings Call Date:Jul 19, 2025

(Q1-2026)

% Change Since: |

Next Earnings Date:Oct 20, 2025

Earnings Call Sentiment Neutral

The earnings call reflects a mixed sentiment with positive aspects such as healthy deposit growth, stable asset quality, and successful strategic initiatives like the HDB listing. However, these are balanced by challenges like slower advances growth, subdued fee income, and pressure on margins due to the current interest rate environment.

Q1-2026 Updates

Positive Updates

Steady Deposit Growth

The bank's average deposits grew at a healthy pace of 16% year-on-year, continuing to gain market share.

Improvement in Credit Deposit Ratio

The credit deposit ratio was brought down from 110% at the time of the merger to about 95%.

Asset Quality Remains Strong

Asset quality remains healthy, with gross NPA levels stable at 82 basis points in the retail segment, excluding agri.

Successful HDB Financial Services Listing

The bank carried out the HDB Financial Services listing process and diluted some stake, culminating in the stocks being listed.

Interim Dividend and Bonus Share Issue

The Board announced an interim dividend of INR 5 per share and recommended the first-ever bonus share issue in a ratio of 1:1.

Negative Updates

Slower Advances Growth

Average advances or AUM growth slowed to about 7% last year, with a slight improvement to 8% in the most recent quarter.

Subdued Fee Income

Fee income was subdued due to lower third-party distribution fees, which affected the overall performance.

Pressure on Net Interest Margin (NIM)

NIMs have been under pressure due to policy rate changes and the lead-lag effect between asset repricing and deposit cost adjustments.

Challenging Liquidity Environment

The liquidity environment remained tight post-merger, affecting the bank's strategies and CASA growth.

Company Guidance

During the HDFC Bank Q1 FY '26 earnings call, CEO Sashi Jagdishan provided insights into the bank's performance and future guidance. The bank reported a growth in average deposits at 16% year-on-year while average advances or assets under management grew by 8% in the June quarter. The credit deposit (CD) ratio was strategically brought down from 110% to 95%. Looking forward, the bank anticipates loan growth to align with system growth in FY '26 and exceed it in FY '27. The asset quality remains robust with retail GNPA at 82 basis points, and the bank continues to carry contingent provisions at 57 basis points of the loans portfolio. The interim dividend announced was INR 5 per share, accompanied by a recommended 1:1 bonus share issue. HDFC Bank's focus remains on customer centricity and leveraging technology, with expectations of improved margins as deposit costs adjust over time. The bank is also confident in the upcoming festive season to boost consumption demand, supported by a stable macroeconomic environment in India.

Hdfc Bank Financial Statement Overview

Summary

HDFC Bank exhibits strong financial health with impressive income growth and solid profitability metrics. The balance sheet is stable with manageable leverage, although significant liabilities require vigilance. Cash flow analysis is constrained by missing recent data, yet historical trends indicate effective cash management.

Income Statement

Very Positive

HDFC Bank shows strong income growth with a robust revenue increase from 2023 to TTM. The Gross Profit Margin and Net Profit Margin are quite healthy, reflecting efficient operations with consistent profitability. The EBIT margin is substantial, indicating solid core operating performance. Revenue growth is notable, suggesting strong business momentum.

Balance Sheet

Positive

The balance sheet of HDFC Bank is solid, with a reasonable Debt-to-Equity ratio showing balanced leverage. The Return on Equity is impressive, highlighting efficient use of equity to generate profits. The Equity Ratio indicates a strong equity base relative to assets, though the high total liabilities could pose potential risks.

Cash Flow

Positive

HDFC Bank's cash flow situation is mixed. The absence of recent operating and free cash flow data limits the analysis. Historical data show positive free cash flow, but fluctuations in cash flow components suggest potential volatility. The Free Cash Flow to Net Income ratio in the past has been strong, indicating effective cash generation relative to net income.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	4.19T	3.52T	1.21T	1.02T	936.66B
Gross Profit	2.19T	1.85T	1.13T	892.43B	777.97B
EBITDA	924.57B	1.05T	685.87B	535.98B	453.69B
Net Income	707.92B	622.66B	495.45B	386.00B	325.98B
Balance Sheet
Total Assets	43.92T	44.12T	25.76T	21.11T	17.98T
Cash, Cash Equivalents and Short-Term Investments	9.20T	7.15T	7.24T	5.99T	5.32T
Total Debt	6.35T	8.09T	3.24T	2.19T	1.48T
Total Liabilities	38.54T	36.23T	22.84T	18.60T	15.82T
Stockholders Equity	5.22T	4.56T	2.91T	2.50T	2.16T
Cash Flow
Free Cash Flow	-2.11T	147.83B	433.58B	554.69B	903.97B
Operating Cash Flow	-2.07T	190.69B	477.20B	581.02B	921.78B
Investing Cash Flow	-38.51B	-3.67T	-4.39T	-3.30T	-2.52T
Financing Cash Flow	2.32T	3.35T	4.17T	2.91T	1.92T

Hdfc Bank Technical Analysis

Technical Analysis Sentiment

Negative

Last Price70.60

Price Trends

50DMA

74.72

Negative

100DMA

73.72

Negative

200DMA

67.93

Positive

Market Momentum

MACD

-1.25

Positive

RSI

32.11

Neutral

STOCH

22.33

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HDB, the sentiment is Negative. The current price of 70.6 is below the 20-day moving average (MA) of 73.07, below the 50-day MA of 74.72, and above the 200-day MA of 67.93, indicating a neutral trend. The MACD of -1.25 indicates Positive momentum. The RSI at 32.11 is Neutral, neither overbought nor oversold. The STOCH value of 22.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HDB.

Hdfc Bank Risk Analysis

Hdfc Bank disclosed 71 risk factors in its most recent earnings report. Hdfc Bank reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Hdfc Bank Peers Comparison

Overall Rating

UnderperformOutperform

Sector (68)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PNC	79 Outperform	$81.66B	14.17	11.19%	3.18%	3.60%	22.68%
IBN	73 Outperform	$113.82B	18.15	17.47%	0.81%	17.32%	12.99%
ITUB	73 Outperform	$71.42B	9.91	20.49%	6.70%	5.44%	2.81%
LYG	71 Outperform	$64.44B	12.63	10.06%	3.89%	0.76%	-5.74%
HDB	69 Neutral	$167.34B	43.39	13.78%	0.18%	2.48%	0.37%
Sector *	68 Neutral	$18.06B	11.97	10.24%	3.74%	9.75%	1.30%
MFG	65 Neutral	$81.60B	13.84	8.69%	2.41%	-2.22%	24.37%

* Financial Sector Average

Performance Comparison

HDB

Hdfc Bank

70.60

9.74

16.00%

IBN

Icici Bank

31.67

2.73

9.43%

ITUB

Itau Unibanco

7.10

1.49

26.56%

LYG

Lloyds Banking

4.35

1.49

52.10%

MFG

Mizuho Financial

6.51

2.50

62.34%

PNC

PNC Financial

204.40

28.17

15.98%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 23, 2025