HDFC Bank Stock Rises as BofA Predicts 17% Growth and End to EPS Downgrades

Shares of HDFC Bank went up by 1% to Rs 1,532 each on May 31 after BofA Securities maintained its ‘buy’ recommendation, setting a target price of Rs 1,800. This suggests a 17% increase from current prices.

This year, HDFC Bank’s stock, India’s largest private lender, dropped over 10%, while the Nifty 50 index rose by 3%.


On February 14, 2024, HDFC Bank’s stock hit a 52-week low of Rs 1,363 due to weak Q3 results. Since then, it has recovered more than 12% thanks to strong Q4 results and better investor sentiment.

BofA analysts believe that HDFC Bank’s current EPS expectations are low and the cycle of downgrades may end soon.

S&P Global Ratings recently changed its rating outlook on HDFC Bank from ‘stable’ to ‘positive’, expecting the Indian banking system to benefit from strong economic growth and structural improvements.

“We expect weak loans in the banking sector to decline from 3.5% of gross loans on March 31, 2024, to about 3.0% by March 31, 2025, due to healthier corporate balance sheets, stricter underwriting standards, and better risk management,” S&P Global said.

HDFC Bank reported a 37.1% year-on-year increase in net profit to Rs 16,512 crore, compared to Rs 12,047 crore a year ago. Its net interest income for the quarter also grew by 24.5% YoY to Rs 29,080 crore.

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