HDFCBANK - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.9
| Stock Code | HDFCBANK | Market Cap | 11,80,130 Cr. | Current Price | 766 ₹ | High / Low | 1,020 ₹ |
| Stock P/E | 15.8 | Book Value | 363 ₹ | Dividend Yield | 1.70 % | ROCE | 6.92 % |
| ROE | 14.1 % | Face Value | 1.00 ₹ | DMA 50 | 799 ₹ | DMA 200 | 884 ₹ |
| Chg in FII Hold | -3.62 % | Chg in DII Hold | 3.14 % | PAT Qtr | 19,221 Cr. | PAT Prev Qtr | 18,654 Cr. |
| RSI | 45.4 | MACD | -9.65 | Volume | 2,62,33,491 | Avg Vol 1Wk | 3,23,67,575 |
| Low price | 727 ₹ | High price | 1,020 ₹ | PEG Ratio | 0.82 | Debt to equity | 6.44 |
| 52w Index | 13.5 % | Qtr Profit Var | 9.11 % | EPS | 48.5 ₹ | Industry PE | 14.4 |
📊 Core Financials
- Revenue Growth: Quarterly PAT rose to ₹19,221 Cr from ₹18,654 Cr, showing 9.11% growth.
- Profit Margins: ROE at 14.1% and ROCE at 6.92% indicate moderate profitability.
- Debt Ratios: Debt-to-equity of 6.44 reflects high leverage typical of banks.
- Cash Flows: Dividend yield of 1.70% provides modest income to shareholders.
- Return Metrics: EPS of ₹48.5 supports steady shareholder returns.
💹 Valuation Indicators
- P/E Ratio: 15.8 vs industry PE of 14.4, slightly above average.
- P/B Ratio: Price ₹766 vs book value ₹363, trading at ~2.1x book.
- PEG Ratio: 0.82, suggesting fair valuation relative to growth.
- Intrinsic Value: Current price below DMA 50 (₹799) and DMA 200 (₹884), showing weakness in momentum.
🏢 Business Model & Competitive Advantage
HDFC Bank is India’s leading private sector bank with strengths in retail banking, corporate lending, and digital services. Its competitive advantage lies in brand trust, wide distribution, and strong customer base. Despite high leverage, consistent profitability and scale reinforce its leadership.
📈 Entry Zone & Long-Term Guidance
Entry zone looks attractive around ₹730–₹770 given RSI (45.4) and MACD (-9.65) showing consolidation. Long-term holding is favorable due to strong market position, steady earnings, and growth potential, though leverage and valuation risks remain.
✅ Positive
- Strong quarterly PAT growth (9.11%).
- Large market cap and industry leadership.
- PEG ratio of 0.82 indicates fair growth valuation.
⚠️ Limitation
- ROCE at 6.92% is relatively weak compared to peers.
- High debt-to-equity ratio (6.44) typical of banking but adds risk.
📉 Company Negative News
- Stock trading below DMA 200, reflecting weak technical momentum.
- FII holding decreased (-3.62%), showing reduced foreign investor confidence.
📈 Company Positive News
- DII holding increased (+3.14%), showing strong domestic institutional support.
- Quarterly PAT improved from ₹18,654 Cr to ₹19,221 Cr.
🏭 Industry
The banking industry in India is growing with rising credit demand and digital adoption. However, regulatory pressures and asset quality risks persist. Industry PE at 14.4 is slightly lower than HDFCBANK’s 15.8, suggesting modest overvaluation.
🔎 Conclusion
HDFCBANK remains a strong player with consistent earnings and industry leadership. While valuations are slightly above peers and leverage is high, its scale and brand strength make it a reliable long-term holding. Entry around ₹730–₹770 is reasonable for investors seeking stability and growth.
Would you like me to also prepare a comparative view of ICICI Bank, Axis Bank, and Kotak Bank to see how HDFCBANK stacks up against its peers?