HDFCBANK - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 3.9
| Stock Code | HDFCBANK | Market Cap | 14,67,641 Cr. | Current Price | 953 ₹ | High / Low | 1,020 ₹ |
| Stock P/E | 20.1 | Book Value | 350 ₹ | Dividend Yield | 1.15 % | ROCE | 7.35 % |
| ROE | 14.3 % | Face Value | 1.00 ₹ | DMA 50 | 959 ₹ | DMA 200 | 958 ₹ |
| Chg in FII Hold | -0.71 % | Chg in DII Hold | 0.93 % | PAT Qtr | 18,654 Cr. | PAT Prev Qtr | 18,641 Cr. |
| RSI | 54.0 | MACD | -8.72 | Volume | 2,55,06,437 | Avg Vol 1Wk | 3,11,01,094 |
| Low price | 831 ₹ | High price | 1,020 ₹ | PEG Ratio | 0.91 | Debt to equity | 6.28 |
| 52w Index | 64.7 % | Qtr Profit Var | 11.5 % | EPS | 47.6 ₹ | Industry PE | 15.8 |
📊 Analysis: HDFCBANK is a large-cap leader with strong profitability (PAT ₹18,654 Cr) and steady EPS (₹47.6). ROE (14.3%) is decent, but ROCE (7.35%) is relatively weak compared to peers. Debt-to-equity (6.28) is high, typical for banks, but manageable given its scale. Valuations are slightly above industry PE (20.1 vs 15.8), though PEG ratio (0.91) suggests growth is reasonably priced. Current price (₹953) is near both 50 DMA (₹959) and 200 DMA (₹958), showing consolidation. The ideal entry zone lies between ₹900–₹930 for long-term investors. If already holding, maintain positions for 3–5 years, leveraging compounding and sector leadership, but consider partial profit booking near ₹1,000–₹1,020 resistance levels.
✅ Positive
- Strong market leadership with ₹14.67 lakh Cr market cap.
- Consistent quarterly profits (₹18,654 Cr vs ₹18,641 Cr).
- PEG ratio (0.91) indicates growth is fairly priced.
- Dividend yield (1.15%) adds shareholder value.
⚠️ Limitation
- ROCE (7.35%) is weak compared to profitability levels.
- High debt-to-equity (6.28), though typical for banks.
- Valuations slightly above industry PE (20.1 vs 15.8).
📉 Company Negative News
- Decline in FII stake (-0.71%), showing reduced foreign investor confidence.
- MACD (-8.72) indicates weak momentum in near term.
📈 Company Positive News
- Quarterly profit variation of 11.5% shows earnings resilience.
- DII holdings increased (+0.93%), reflecting domestic institutional confidence.
- Stable EPS (₹47.6) supports long-term compounding.
🏭 Industry
- Banking sector remains a backbone of Indian economy with steady credit growth.
- Industry PE (15.8) lower than HDFCBANK, suggesting peers may offer better valuations.
🔎 Conclusion
HDFCBANK is a fundamentally strong banking giant with consistent profitability and sector leadership. However, valuations are slightly stretched and ROCE is modest. Ideal entry is around ₹900–₹930. Existing holders should maintain positions for 3–5 years, leveraging compounding and dividends, while booking profits near ₹1,000–₹1,020 resistance levels.
Would you like me to extend this with a peer benchmarking overlay (ICICI Bank, Axis Bank, Kotak Bank) so you can compare HDFCBANK’s valuation and efficiency metrics against its closest competitors?