HDFC Bank Receives ‘Buy’ Rating from Citi with 44% Upside Potential, Citing Strong Franchise

Citi Analysts Highlight HDFC Bank’s Focus on Sustainable Franchise Building, Emphasizing Balanced Profitable Growth.

Citi Grants ‘Buy’ Rating to HDFC Bank, Sets Target Price at Rs 2,050 per Share, Signaling a 44% Upside from Previous Close of Rs 1,417. Analysts Trust in the Bank’s Strong and Sustainable Franchise, Anticipating Profitable Growth in the Future.

Despite a Challenging Year, HDFC Bank’s Stock, the Largest Private Sector Lender in India, Has Seen a 17% Dip, in Contrast to the 0.6% Gain in the Benchmark Sensex.

Citi Analysts Highlight HDFC Bank’s Focus on Maintaining Healthy Incremental Liquidity Deposit Ratio (LDR) and Liquidity Coverage Ratio (LCR), Along with Adjusting Lending Rates to Offset Increased Funding Costs. The Bank Aims to Sustain Net Interest Margin (NIM) and Return on Assets (RoA) Within Targeted Parameters.

Furthermore, Recent Developments at Paytm Have Boosted the Company’s Optimism Regarding Potential Opportunities, According to Analysts. Leveraging the Group’s Capabilities, HDFC Bank Can Enhance its Share in Third-Party Distribution Channels.

Paytm Forms Partnership with Axis Bank for Merchant Payment Settlements as RBI Extends Deadline for Paytm Payments Bank Customers and Merchants to March 15

In addition, analysts at Citi confirmed that HDB Financial Services is progressing as scheduled towards its listing timelines.

Meanwhile, analysts at Morgan Stanley have reiterated an ‘overweight’ rating on HDFC Bank, setting a target price of Rs 2,110 per share. The optimistic outlook follows the bank’s management announcement of achieving stable and robust double-digit year-on-year (YoY) growth in its home loan business post-merger until December 31, 2023.

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