HDFC Bank’s shares fell by 0.6 percent to ₹959.50 in Friday’s trading session, despite a favorable outlook from brokerages following the Reserve Bank of India’s (RBI) monetary policy announcement. The stock opened at ₹952, hovering near its day’s low, with selling outpacing buying at 8.24 lakh shares compared to 6 lakh shares.
Jefferies reiterated its positive perspective on HDFC Bank, along with other private banks such as Axis, ICICI, and SBI, citing that the decision to maintain interest rates had alleviated pressure on these institutions. The brokerage highlighted that the impending transition to the Expected Credit Loss (ECL) framework, expected to begin in April 2027, will lead to one-time charges. However, this impact can be mitigated over five years through lower risk weights.
Naveen Kulkarni, Chief Investment Officer at Axis Securities PMS, mentioned that the RBI’s move to keep the repo rate steady was anticipated. He acknowledged that recent adjustments in GST rates are likely to boost consumption during the festive season, although concerns regarding tariffs from the U.S. persist.
The banking sector is expected to face challenges in the second quarter, with sluggish credit growth, margin pressures, diminished treasury performance, and increased credit costs. Nevertheless, analysts predict a turnaround in the second half of the fiscal year, with net interest margins (NIMs) expected to reach their lowest point in Q2. Support is expected to arise from deposit repricing and a reduction in the cash reserve ratio (CRR).
Over the past year, HDFC Bank’s stock price has ranged between ₹806.50 and ₹1,018.85, with the current market capitalization standing at ₹14.74 lakh crore.
