HDFC Bank is a publicly held banking company. The bank was incorporated in August 1994 in the name of ‘HDFC Bank Limited’, with its registered office in Mumbai, India. It is engaged in providing a range of banking and financial services including retail banking, wholesale banking and treasury operations. It is promoted by HDFC Ltd. which has 19.32% stake as on September 30, 2020. Currently, HDFC Bank Ltd. is the largest private sector bank in India.
HDFC Bank is India’s largest private sector bank by assets and world’s 10th largest bank by market capitalisation as of April 2021. It is the third largest company by market capitalisation of ₹9 lakh crore on the Indian stock exchanges. The bank is the fifteenth largest employer in India with nearly 150,000 employees.
Quarterly Growth Walkthrough
HDFC Bank reported a massive 20 percent year-on-year (YoY) rise in its consolidated net profit at Rs 12,735 crore for the third quarter of the current fiscal year. Revenues from operations have increased by a fantastic 30 percent to Rs 45,002 crore for that quarter. Consolidated advances have grown by 19 percent YoY to Rs 15.63 lakh crore in the past quarter from Rs 13.12 lakh crore in corresponding quarter of the previous fiscal year.
Net interest income for the last quarter has risen by 25 percent YoY to Rs 22,988 crore from Rs 18.443 crore in corresponding quarter. Core net interest margin was reported at 4.1 percent of the total assets.
The bank’s gross non-performing assets (GNPA) were at 1.23 percent of gross advances as on December 31, 2022 (1 percent excluding NPAs in the agricultural segment), which has remains unchanged as it was 1.23 percent in the previous quarter. Net non-performing assets (NNPA) are at 0.33 percent for the quarter, which displays no enhancement or degeneration as compared with the previous quarter.
Total deposits have laid out a vital growth of 20 percent YoY and were reported at Rs 17.33 lakh crore as of 30th December 2022. CASA (current account savings account) deposits have grown by 12 percent with savings account deposits at Rs 535,206 crore and current account deposits at Rs 227,745 crore.
The provisions and contingencies for the quarter have declined to Rs 2,806 crore as compared to Rs 2,994 crore YoY. The total credit cost ratio stands at 0.74 percent in the last quarter versus 0.94 percent in Q3FY22.
HDFC Bank’s distribution network count has increased to 7,183 branches and 19,007 ATMs / Cash Deposit & Withdrawal Machines (CDMs) covering 3,552 cities and towns.
Technical Analysis
HDFC Bank share price continues to face heavy resistance along the target retracement level of 161.8% at Rs 1654. The stock faces heavy resistance when the price approaches the range of Rs 1560-1530. It certainly confirms the operators’ presence controlling the stock price under this range. Since the results have been fantastic and growth has been stellar, we can expect a breakout as the candles have formed a bullish flag pattern which is a continuation candlestick pattern. The next target according to the retracement level for the 261.8% level is at Rs 2220.
The weekly MFI is at 64 points which indicates the stock is nearing its overbought zone and the price has certainly overextended beyond the 200-day moving average which marks the stock as highly expensive and overbought.
If the stock fails to make a breakout, we may witness a correction up to the swing lows of Rs 1270 which is a great price for long-term investors to accumulate India’s biggest banking firm.
Disclaimer: We do not endorse or encourage you to take trades or investment decisions based upon our posts/research, all of your trading and investment activities are your own and should be taken through consultation with reputed financial advisors. The analysis posted on this website has been created by involving multiple mediums which are present over the Internet.