HDFC Bank’s total deposits have increased by 19.3 percent year-on-year to 16.1 lakh crore. Whereas CASA deposits have grown by 20 per cent year-on-year.
Banking Stock to Buy: HDFC Bank has released the update for the first quarter of FY 2023. The growth of the bank in the June quarter has been strong. Advances, deposits have increased on a yearly basis, while retail loans have seen strong growth. Commercial and rural banking also remained strong. Brokerage house Motilal Oswal has given a better outlook for the stock and has given investment advice in it. The brokerage says that the profit of the bank is expected to be better going forward. Its advantage can be seen in the form of growth in the stock. The brokerage has expressed an expectation of 37 percent return in the stock.
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Advance up 21.5%
HDFC Bank’s total advance has increased by 21.5 percent year-on-year to 13.9 lakh trillion. There has been a growth of 1.9 percent on a quarterly basis. As per the bank’s internal classification, retail loans have grown by 21.5 per cent year-on-year and 5 per cent on a quarterly basis. Commercial and rural banking remains strong with 29 per cent year-on-year and 3 per cent quarter-on-quarter growth. Corporate and other wholesale books have also grown by 15.5 per cent year-on-year, though flat on a quarterly basis.
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Total deposits up 19.3%
HDFC Bank’s total deposits have increased by 19.3 percent year-on-year to 16.1 lakh crore. There has been a growth of 2.9 percent on a quarterly basis. While CASA deposits grew by 20 per cent year-on-year, it declined by 2.2 per cent on a quarterly basis. The CASA mix has come down by 220bp on a quarterly basis to 46 per cent. Retail and wholesale deposit growth has been 18.5%/22.5% y-o-y and 3.5%/0.5% y-o-y. The bank has purchased a total loan of 9530 crores through Direct Assignment Route under Home Loan Arrangement with HDFC in 1QFY23.
Share price can go up to Rs 1850
Brokerage house Motilal Oswal says that HDFC Bank’s loan growth has been strong on a year-on-year basis. However, it remained below the trend on a quarterly basis. There was a healthy revival in retail loans, while strong traction was seen in commercial banking and corporate segment, which could support the growth in PPOP. The brokerage expects margins to improve going forward and retail loan growth and fee income from unsecured products to improve. The brokerage has kept a target of Rs 1850 while advising to buy in the stock. In terms of current price Rs 1356, it can give 36 to 37 percent return.
(Disclaimer: Stock investment advice is given by the brokerage house. These are not the personal views of The Financial Express. Markets are risky, so take expert opinion before investing.)
