HDFC Bank’s Over 20% Profit Growth Helps Analysts Stay Upbeat

JM Financial

• Management attributes this to short-term loans to higher-rated corporates
• Provision coverage ratio is best in class at 71 percent; slippage or loans turning sour moderated to 2 percent
• Bank remains top picks in banking sector; maintain buy

Prabhudas Lilladher

• Bank consciously has slowed retail growth in certain segments
• Overall loan growth supported by non-retail which were largely short term Management tone on agri loans continues to remain cautious and continues to add to contingent provisions
• Keeping an eye on cost of funds as liabilities seem to be a challenge in near term
• Retain buy, price target raised to Rs 2,700 from Rs 2,371

ICICI Securities

• Bank is consolidating, pacing its loan growth in select retail segments
• Credit cost factoring in risks on its agriculture book
• Muted fee income growth appears temporary mainly due to base effect
• Expect 25 percent EPS CAGR over FY19-21 and return of assets touching 2 percent
• Maintain buy on stock, price target Rs 2,639