HDFC Bank Shares Hit 52-Week Low Amidst Q3 Earnings, Analysts Share Outlook

Shares of private sector lender HDFC Bank hit a 52-week low during early trade today, following its announcement of Q3 earnings. The bank’s stock fell 1.26% to reach a yearly low of Rs 1459.95 on BSE, signaling an oversold condition with an RSI of 24.5.

This decline comes after a 10% drop last week following the bank’s Q3 earnings report, which surprised investors. HDFC Bank’s market cap also dropped to Rs 11.12 lakh crore amid a broader market rally.

Several brokerage firms have shared their outlook on the stock. CLSA has maintained a buy rating with a target price of Rs 2,025 per share. Foreign investors seem to believe that the bank is nearing the end of the EPS cuts cycle, although concerns remain regarding deposits and net interest margins (NIM). KR Choksey has assigned a target price of Rs 1,950, while Nuvama has downgraded the stock to ‘hold’ post Q3 earnings. Motilal Oswal assigns a target of Rs 1,950 to HDFC Bank.

HDFC Bank reported a 34% rise in standalone net profit to Rs 16,373 crore for Q3 FY24, with total income reaching Rs 81,720 crore for the same period. The bank’s margin remained largely flat, but loan growth was healthy, especially in retail and commercial banking. Asset quality ratios improved, and the provision coverage ratio (PCR) increased to 75%.

Despite the recent challenges, analysts believe in the long-term potential of HDFC Bank. It continues to trade below various moving averages and could present a buying opportunity for investors.