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HDFC Bank Limited (IN:HDFCBANK)
:HDFCBANK
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HDFC Bank Limited
(HDFCBANK)
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Rating:77Outperform
Price Target:
₹1,094.00
▲(15.10% Upside)
HDFC Bank's strong financial performance, particularly in revenue and profit growth, is the primary driver of its stock score. The earnings call provided a balanced view with positive strategic initiatives, despite some challenges in loan growth and margins. Technical indicators suggest caution, while the valuation remains reasonable.
HDFC Bank Limited (HDFCBANK) vs. iShares MSCI India ETF (INDA)
Market Cap
₹14.60T
Dividend Yield2.31%
Average Volume (3M)639.52K
Price to Earnings (P/E)20.7
Beta (1Y)0.96
Revenue Growth4.96%
EPS Growth2.79%
CountryIN
Employees214,521
SectorFinancial
Sector Strength70
IndustryBanks - Regional
Share Statistics
EPS (TTM)11.85
Shares Outstanding15,360,348,000
10 Day Avg. Volume660,100
30 Day Avg. Volume639,517
Financial Highlights & Ratios
PEG Ratio-23.46
Price to Book (P/B)1.29
Price to Sales (P/S)1.43
P/FCF Ratio-3.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
₹1,157.64Price Target Upside21.79% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering14
HDFC Bank Limited Business Overview & Revenue Model
Company DescriptionHDFC Bank Limited provides various banking and financial services to individuals and businesses in India, Bahrain, Hong Kong, and Dubai. It operates in Treasury, Retail Banking, Wholesale Banking, Other Banking Business, and Unallocated segments. The company accepts savings, salary, current, rural, public provident fund, pension, and Demat accounts; fixed and recurring deposits; and safe deposit lockers; as well as offshore accounts and deposits, overdrafts against fixed deposits, and sweep-in facilities. It also provides personal, home, car, two wheeler, business, educational, gold, consumer, and rural loans; loans against properties, securities, rental receivables, and assets; loans for professionals; government sponsored programs; and loans on credit card, as well as working capital and commercial/construction equipment finance, healthcare/medical equipment and commercial vehicle finance, dealer finance, and term and professional loans. The company offers credit, debit, prepaid, and forex cards; payment and collection, export, import, remittance, bank guarantee, letter of credit, trade, hedging, and merchant and cash management services; insurance and investment products. It provides short term finance, bill discounting, structured finance, export credit, loan syndication, and documents collection services; online and wholesale, mobile, and phone banking services; unified payment interface, immediate payment, national electronic funds transfer, and real time gross settlement services; and channel financing, vendor financing, reimbursement account, money market, derivatives, employee trusts, cash surplus corporates, tax payment, and bankers to rights/public issue services, as well as financial solutions for supply chain partners and agricultural customers. As of March 31, 2022, the company had 21,683 banking outlets; 6,342 branches; and 18,130 automated teller machines in 3,188 cities/towns. HDFC Bank Limited was incorporated in 1994 and is based in Mumbai, India.
How the Company Makes MoneyHDFC Bank Limited generates revenue through several key channels. One of the primary sources of income is interest earned from loans provided to individuals and businesses, encompassing personal, home, auto, and business loans. Additionally, the bank earns from fees and commissions associated with banking transactions and services, such as credit card fees, transaction processing fees, and investment product sales. The bank also gains from treasury operations, which involve trading and investment activities in the financial markets. HDFC Bank's extensive branch network and digital banking platforms support its ability to offer a wide range of financial products and services, contributing significantly to its revenue. Strategic partnerships with various financial service providers and corporations further enhance its service offerings and revenue-generating capabilities.
HDFC Bank Limited Earnings Call Summary
Earnings Call Date:Jul 19, 2025
(Q1-2026)
| Next Earnings Date:Oct 18, 2025
Earnings Call Sentiment Neutral
The earnings call demonstrated a balanced perspective with strong highlights in deposit growth, asset quality, and shareholder returns. However, challenges in loan growth, margin pressure, and fee income presented notable concerns. The bank's strategic initiatives and resilience highlight a cautiously optimistic outlook.Q1-2026 Updates
Positive Updates
Deposit Growth and Market Share
HDFC Bank reported a healthy 16% year-on-year growth in average deposits, continuing to gain market share despite challenging conditions.
Asset Quality and Contingent Provisions
The bank maintained a robust asset quality with retail GNPA at 82 basis points, consistent over the year. A contingent provision of INR 1,700 crores was added, enhancing financial resilience.
HDB Financial Services IPO
The successful listing of HDB Financial Services was completed, and the bank diluted some stake with stocks listed on July 2nd.
Interim Dividend and Bonus Share Issue
The Board announced an interim dividend of INR 5 per share and recommended a 1:1 bonus share issue, marking a significant reward for shareholders.
Strong Employee Growth
The bank added 4,000 employees in the quarter, primarily driven by branch openings and increased sales force.
Negative Updates
Slower Loan Growth
Loan growth was subdued at 7% in the previous fiscal year and only improved slightly to 8% in the current quarter, below historical averages.
Pressure on Margins
The bank faced margin pressure due to the lag in repricing deposits after rate cuts, impacting profitability in the short term.
Challenges in CASA Growth
The bank experienced a slowdown in CASA market share growth, attributed to strategic deposit gathering efforts and intense competition.
Subdued Fee Income
Fee income was lower, particularly in third-party distribution fees, impacting overall non-interest income performance.
Company Guidance
During HDFC Bank Limited's Q1 FY '26 earnings call, the bank provided detailed guidance on its financial performance and strategic direction. The bank reported a robust 16% year-on-year growth in average deposits, although it intentionally slowed down its average advances growth to 7% last year to reduce its credit-deposit ratio from 110% to 95%. This growth rate for assets under management improved to 8% in the June quarter of FY '26. Looking forward, HDFC Bank aims to align its loan growth with the system growth rate in FY '26 and exceed it in FY '27. The guidance highlighted that approximately 70% of the bank's asset side is floating in nature, which presents a challenge in a declining rate environment due to the fixed nature of the liabilities. Nonetheless, the bank remains confident in its asset quality and expects stable margins over time. Additionally, the bank announced an interim dividend of INR 5 per share and a 1:1 bonus share issue. There was also a mention of the HDB Financial Services listing process, which concluded with the stocks being listed on July 2. Overall, HDFC Bank remains focused on customer centricity, technology, and leveraging its people as key growth enablers, despite the challenges posed by a volatile global environment.HDFC Bank Limited Financial Statement Overview
Summary
HDFC Bank has demonstrated strong revenue and profit growth with efficient cost management and improving profitability margins. The balance sheet shows stability with moderate leverage and good return on equity. However, cash flows have shown some volatility, and efforts should be directed towards improving free cash flow stability.Income Statement
HDFC Bank has shown consistent revenue growth with a significant increase from 2020 to 2025. Revenue grew from 794,470,700,000 in 2020 to 4,709,150,000,000 in 2025, demonstrating robust growth. The gross profit margin is strong at around 60.9% for 2025, indicating efficient cost management. Net profit margin improved to 15.0% in 2025, showing enhanced profitability. The EBIT and EBITDA margins have also improved, reflecting strong operational efficiency.92
Very Positive
Balance Sheet
The balance sheet of HDFC Bank demonstrates stability with a debt-to-equity ratio of 1.22 in 2025, showing moderate leverage. The return on equity has been improving, reaching 13.6% in 2025, indicating efficient use of equity capital. The equity ratio is 11.9%, suggesting a sound capital structure with a substantial asset base.85
Very Positive
Cash Flow
Cash flow from operations has been volatile, with negative figures in 2025. Free cash flow shows a decline, which could be a concern. However, the operating cash flow to net income ratio is improving, indicating better cash conversion from income. The bank needs to focus on stabilizing its free cash flow for stronger financial health.78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.87T | 4.71T | 2.29T | 1.13T | 911.86B | 1.53T |
| Gross Profit | 2.94T | 2.87T | 2.29T | 1.13T | 892.43B | 777.97B |
| EBITDA | 2.34T | 2.84T | 757.81B | 638.47B | 525.55B | 441.82B |
| Net Income | 705.75B | 707.92B | 640.62B | 459.97B | 380.53B | 325.98B |
Balance Sheet | ||||||
| Total Assets | 44.56T | 43.92T | 40.30T | 25.76T | 21.11T | 18.00T |
| Cash, Cash Equivalents and Short-Term Investments | 2.15T | 9.20T | 9.93T | 7.24T | 4.34T | 5.32T |
| Total Debt | 6.00T | 6.35T | 7.31T | 3.24T | 2.19T | 1.92T |
| Total Liabilities | 38.93T | 38.54T | 35.60T | 22.84T | 18.60T | 15.89T |
| Stockholders Equity | 5.43T | 5.22T | 4.56T | 2.89T | 2.47T | 2.10T |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | -2.11T | 968.48B | 433.58B | 554.69B | 407.80B |
| Operating Cash Flow | 0.00 | -2.07T | 1.02T | 477.20B | 581.02B | 424.76B |
| Investing Cash Flow | 0.00 | -38.51B | -3.67T | -4.39T | -3.30T | -16.81B |
| Financing Cash Flow | 0.00 | 2.32T | 3.35T | 4.17T | 2.91T | -73.21B |
HDFC Bank Limited Technical Analysis
Negative
950.50
Price Trends
981.97
Negative
974.27
Negative
921.77
Positive
Market Momentum
-5.31
Positive
35.58
Neutral
16.64
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:HDFCBANK, the sentiment is Negative. The current price of 950.5 is below the 20-day moving average (MA) of 961.48, below the 50-day MA of 981.97, and above the 200-day MA of 921.77, indicating a neutral trend. The MACD of -5.31 indicates Positive momentum. The RSI at 35.58 is Neutral, neither overbought nor oversold. The STOCH value of 16.64 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:HDFCBANK.
HDFC Bank Limited Risk Analysis
HDFC Bank Limited disclosed 71 risk factors in its most recent earnings report. HDFC Bank Limited 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 Limited Peers Comparison
Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | ₹14.60T | 20.74 | ― | 2.31% | 4.96% | 2.79% | |
76 Outperform | 3.60T | 13.01 | 14.98% | 0.09% | 10.17% | 3.87% | |
75 Outperform | 9.87T | 18.65 | 16.26% | 0.80% | 20.17% | 15.72% | |
74 Outperform | 1.32T | 6.73 | 14.14% | 3.28% | 7.78% | 2.18% | |
68 Neutral | 1.28T | 7.75 | 13.88% | 2.61% | 15.52% | 37.23% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
Performance Comparison
IN:HDFCBANK
HDFC Bank Limited
950.50
71.23
8.10%
IN:AXISBANK
Axis Bank Limited
1,158.80
-116.41
-9.13%
IN:BANKBARODA
Bank of Baroda
254.35
17.47
7.38%
IN:ICICIBANK
ICICI Bank Limited
1,381.95
61.24
4.64%
IN:PNB
Punjab National Bank
111.00
6.72
6.44%
IN:SBIN
State Bank of India
865.85
79.74
10.14%
HDFC Bank Limited Corporate Events
HDFC Bank Reports Strong Financial Growth in June 2025 Quarter
Jul 4, 2025
HDFC Bank Limited reported significant growth in its financial metrics for the quarter ending June 2025. The bank’s average advances under management grew by 8.3% year-on-year, while average deposits increased by 16.4% over the same period. This growth reflects the bank’s strategic initiatives, including the securitization and assignment of loans amounting to ₹33 billion. The bank’s robust performance in advances and deposits underscores its strong market positioning and operational efficiency, which are likely to have positive implications for stakeholders.
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.