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Hdfc Bank Limited (HDB)
NYSE:HDB
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Hdfc Bank
(NYSE:HDB)
Rating:73Outperform
Price Target:―
Positive Factors
Financial Performance
Net profit surpassed expectations, indicating strong financial performance.
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 the gross NPA ratio rose to 1.42%, indicating a slight decline in asset quality.
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
$174.06B
Dividend Yield1.6%
Average Volume (3M)1.99M
Price to Earnings (P/E)23.1
Beta (1Y)0.35
Revenue Growth13.13%
EPS Growth0.54%
CountryUS
Employees214,521
SectorFinancial
Sector Strength78
IndustryBanks - Regional
Share Statistics
EPS (TTM)0.82
Shares Outstanding2,555,971,200
10 Day Avg. Volume1,775,606
30 Day Avg. Volume1,992,603
Financial Highlights & Ratios
PEG Ratio-45.93
Price to Book (P/B)2.95
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$82.00Price Target Upside4.90% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Hdfc Bank Business Overview & Revenue Model
Company DescriptionHDFC Bank Limited (HDB) is one of India's leading private sector banks, headquartered in Mumbai, Maharashtra. Established in 1994, it operates in the financial services sector, providing a wide range of banking products and services to individual and corporate clients. The bank's core offerings include retail banking, wholesale banking, and treasury operations, supported by a comprehensive suite of digital banking solutions. HDFC Bank is known for its robust network of branches and ATMs across India, catering to millions of customers with innovative financial solutions.
How the Company Makes MoneyHDFC Bank generates revenue primarily through interest income from its lending activities, which includes personal loans, home loans, auto loans, and credit cards. Additionally, the bank earns non-interest income through fees and commissions from services such as wealth management, insurance, and investment products. HDFC Bank also benefits from its treasury operations, which involve managing its investment portfolio and trading in government securities, foreign exchange, and derivatives. The bank's profitability is further supported by its extensive branch network and digital platforms, which facilitate customer acquisition and retention. Strategic partnerships with fintech companies and adherence to regulatory frameworks also play a crucial role in its revenue generation.
Hdfc Bank Earnings Call Summary
Earnings Call Date:Jul 19, 2025
(Q1-2026)
| % Change Since: 32.81%|
Next Earnings Date:Oct 20, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed view with strong deposit growth and asset quality as positive indicators, while loan growth slowdown and NIM pressure were notable challenges.Q1-2026 Updates
Positive Updates
Strong Deposit Growth
Deposits grew at a healthy pace of 16% year-on-year, indicating strong market share gains.
Strategic Reduction in Credit-Deposit Ratio
Successfully reduced the credit-deposit ratio from 110% to 95%, aligning with strategic objectives.
Healthy Asset Quality
Asset quality remains strong with stable gross NPA levels and benign credit costs.
Interim Dividend and Bonus Share Issue
Board announced an interim dividend of INR 5 per share and a 1:1 bonus share issue.
HDB Financial Services IPO
Successful listing of HDB Financial Services, with the bank diluting some stake.
Negative Updates
Slowing Loan Growth
Loan growth slowed to 8% in the recent quarter, impacted by strategic slowdown to adjust the credit-deposit ratio.
Subdued Fee Income
Third-party distribution fees were lower than expected, affecting overall fee income.
NIM Pressure
Net Interest Margin (NIM) under pressure due to high-cost liabilities and competitive pricing.
High Wholesale Deposit Proportion
Wholesale deposits increased to 18%, potentially impacting cost of funds.
Company Guidance
During HDFC Bank's Q1 FY '26 earnings call, the management provided guidance on several key metrics and strategic priorities. The bank reported a 16% year-on-year growth in average deposits, while Asset Under Management (AUM) growth slowed to 7% last year, aligning with strategic objectives to reduce the credit deposit (CD) ratio from 110% at the time of the merger to 95% currently. This AUM growth improved to 8% in the quarter ending June FY '26. Management expressed confidence in achieving system growth rates in loan advances for FY '26 and exceeding them in FY '27. The call highlighted the bank's focus on customer centricity, technology, and human resources as growth enablers. Asset quality remains strong, with the retail segment's gross NPA at 82 basis points, unchanged from the previous year. The bank announced an interim dividend of INR 5 per share and a 1:1 bonus share issue. Additionally, the management discussed the impact of policy rate changes on margins, noting a headwind from the lag in repricing deposits compared to the asset side, which is 70% floating. The bank's contingent provisions increased to 57 basis points of the loans portfolio, aimed at building resiliency. Furthermore, the bank completed the listing of HDB Financial Services, highlighting continued investor confidence.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
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.85
Very Positive
Balance Sheet
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.78
Positive
Cash Flow
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.65
Positive
| Breakdown | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.73T | 3.52T | 1.21T | 1.02T | 936.66B |
| Gross Profit | 2.73T | 1.85T | 1.13T | 892.43B | 777.97B |
| EBITDA | 0.00 | 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
Positive
78.17
Price Trends
75.10
Positive
70.72
Positive
66.65
Positive
Market Momentum
0.55
Negative
61.86
Neutral
69.65
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HDB, the sentiment is Positive. The current price of 78.17 is above the 20-day moving average (MA) of 76.33, above the 50-day MA of 75.10, and above the 200-day MA of 66.65, indicating a bullish trend. The MACD of 0.55 indicates Negative momentum. The RSI at 61.86 is Neutral, neither overbought nor oversold. The STOCH value of 69.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 3 New Risks
1.
Reforms to and replacement of IBORs and certain other rates or indices may adversely affect our reputation, business, financial condition and results of operations. Q1, 2022
2.
The Scheme with HDFC Limited is subject to a number of conditions, some of which are outside of the parties’ control, and, if these conditions are not satisfied, the Scheme may be terminated and the Proposed Transaction may not be completed. Q1, 2022
3.
Uncertainty about the Proposed Transaction may adversely affect the relationships of the Parties with their respective investors, customers, business partners and employees, whether or not the Proposed Transaction is completed. Q1, 2022
Hdfc Bank Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $219.26B | 11.60 | 10.83% | 7.53% | -1.91% | -6.79% | |
78 Outperform | $262.42B | 13.82 | 11.51% | 1.99% | 0.22% | 19.89% | |
76 Outperform | $150.87B | 12.66 | 9.18% | 2.64% | 5.39% | 20.82% | |
74 Outperform | $118.06B | 18.90 | 17.47% | 0.70% | 17.32% | 12.99% | |
73 Outperform | $174.06B | 23.12 | 13.78% | 1.60% | 13.13% | 0.54% | |
73 Outperform | $174.54B | 13.82 | 6.64% | 2.38% | 0.52% | 89.25% | |
64 Neutral | $6.64B | 10.23 | 7.22% | 200.95% | 24.10% | 5.12% |
* Financial Sector Average
Performance Comparison
HDB
Hdfc Bank
78.17
18.23
30.41%
C
Citigroup
94.00
31.46
50.30%
HSBC
HSBC Holdings
63.60
22.95
56.46%
IBN
Icici Bank
34.09
5.19
17.96%
MUFG
Mitsubishi UFJ
13.68
2.60
23.47%
WFC
Wells Fargo
82.38
24.11
41.38%
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.