Buy HDFC Bank, target Rs 2,820: Anand Rathi

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HDFC Bank Limited is our top pick amongst the private sector banks. We re-initiate our coverage on HDFC Bank Limited with a BUY rating and target price of Rs 2820 per share.






HDFC Bank is largely a retail bank and earns majority of its revenues and income from the same. Retail and corporate constitute 54 percent and 46 percent respectively to its loan mix as on March 31, 2019.

The company’s advances has registered a CAGR of 22 percent in the last four years. The NII of the company has registered a CAGR of 21 percent in the last four years.


With several process changes, the bank is looking at a massive increase in the number of accounts opened per branch per day from 1.8 to 3 over the next 18 months. This will drive healthy growth in liabilities and offer higher cross-selling opportunities.

Capital constraints in public sector banks will provide an opportunity to the private sector banks to increase their market share and outperform in banking & financial services space.

Further, we expect HDFC Bank to be a major gainer of the current crisis in the NBFC space as it has best-in-class liability franchises along with superior customer outreach across business segments.

Backed by the robust underwriting skills & prudence and the consistent track record of growth and profitability, HDFC Bank Limited is our top pick amongst the private sector banks. We re-initiate our coverage on HDFC Bank Limited with a BUY rating and target price of Rs 2820 per share.



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