With blockbuster Q2 Results, Where do you see the HDFC Bank share price going?

HDFC Twins have been one of the best-performing stocks since their listing on the Indian bourses.

HDFC Bank Stock Performance in the Last 20 Years

A phenomenal return of more than 30000% in the last 20years. The stock goes beyond the normal expectation of a multi-bagger or a stable bet

So, how has HDFC Bank been able to keep up with the changing time?

HDFC Bank Logo

To name a few strategies the bank has utilized for taking on the competition:

  1. Maintaining Customer Satisfaction
  2. Improving the base
  3. Measured Lending
  4. Improving the Quality of the Services

This is one of the reasons why despite the loss of confidence in the banking sector owing to reasons like Non-Performing Assets (subsequent Haircut), Nepotism, Quid Pro Quo Deals – HDFC Bank has managed to stay serene and weather out the different storms.

Even in the Covid lockdown and recovery phase, the bank has focused on

  • Maintaining Asset Quality
  • Increasing the Retail Book
  • Keeping Adequate Capital for Disposal when need be
  • Increased disbursements under the Emergency Credit Line Guarantee Scheme (ECLGS) as part of the Covid relief package by the government
Govt expands ECLGS scheme for MSMEs amid second wave of COVID-19
ECGLS of the Government for the MSME Sector to overcome Covid-19 challenges

In the recently announced results,

→ Quarterly profit rose 18%

→ Loans grew 15.5% from a year ago (about 3x the banking sector’s rate)

HDFC Bank: Q2 Results with Profit Growth ~17.5% Year on Year (Y-o-Y)

With this backdrop, it is absolutely clear that the bank is set to gain from the festival-related spending and recovery in demand (retail/industry)

Owing to this, it can be easily stated that the stock is set to rise further(~10–20%) in the next 8–12months

As an investor, it is best to buy on dips and accumulate rather than booking profits.

Hope this helps. Do share if you find this helpful with others

Reference:

  1. HDFC Bank Profit Tops Estimates on Post-Covid Wave Loan Growth
  2. What made HDFC Bank outshine peers amid Covid-19 second wave
  3. Most Valuable Indian Bank Plots Path to Double Retail Loans
  4. Emergency loan scheme: HDFC Bank beats SBI in Covid scheme loans | India Business News – Times of India
  5. Centre extends Emergency Credit Line Guarantee Scheme till the end of November
  6. HDFC Bank Q2 results

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