HDFC Bank shares rose for a third consecutive session on Tuesday, with the stock gaining 1.3% in intraday deals and touching an intraday high of ₹749.30 on the NSE. The stock has now risen in seven out of eight trading sessions, adding 9% during this period and ₹93,521 crore to market capitalisation, bringing the bank's market capitalisation to ₹11.52 trillion, close to the day's high, compared with ₹10.59 trillion as of the September 9 close. According to Business Standard, a potential announcement is expected this week, though there is no official confirmation yet. The latest gains follow reports that the RBI is weighing Anup Bagchi's candidature for the bank's CEO and MD post, with the central bank having sought feedback from insurance regulator IRDAI and ICICI Bank CEO Sandeep Bakhshi on the 55-year-old executive's suitability for the top job at India's largest private bank.
Anup Bagchi, a seasoned veteran from the ICICI Group, has emerged as the leading contender to become the next Managing Director and Chief Executive Officer of HDFC Bank, according to multiple reports. The 55-year-old executive currently serves as Managing Director and CEO of ICICI Prudential Life Insurance Company, a position he has held since 2023. Before joining the insurance company, he was an executive director at ICICI Bank from 2017, with responsibilities spanning wholesale banking, transaction banking, markets and proprietary trading. As per The Financial Express, the RBI is examining whether his absence from mainstream banking during this period could affect the speed at which he adapts to changes in the regulatory and operating environment. The central bank has reportedly sought feedback from insurance regulator IRDAI and ICICI Bank CEO Sandeep Bakhshi on Bagchi's candidature, with one source noting that "The key question is whether the RBI is comfortable with Bagchi's transition back into mainstream banking after more than three years away."
While the central bank appears increasingly inclined toward choosing an external candidate to lead HDFC Bank, no final decision has been reached yet, as reported by The Financial Express. The RBI's preference for an external candidate represents a significant shift in the bank's leadership succession planning, potentially marking a departure from internal promotions for the top position. According to The Financial Express, the board was understood to prefer Deputy Managing Director Kaizad Bharucha, though his candidature faces regulatory complications as he would hit the RBI's 15-year ceiling for continuous tenure as a whole-time director, MD or CEO in June 2029, before completing a full three-year term as CEO. The bank has sought a relaxation of about six months from the tenure rules that would allow Bharucha to complete a full three-year term, though such dispensations are typically considered only in exceptional circumstances.
According to Business Standard, HDFC Bank's board submitted two names to the RBI for the appointment of its next MD and CEO earlier this month, though the bank has not publicly disclosed the names of the candidates. The bank disclosed the submission through an exchange filing but did not name the candidates, with the names submitted along with proposed remuneration for a three-year term. Bagchi is one of two candidates that HDFC Bank submitted to the RBI on September 12 for appointment as MD and CEO for a three-year term, with the other being deputy managing director Kaizad Bharucha. The assessment comes against a tight timeline, as incumbent Sashidhar Jagdishan's term ends on October 26, with the succession process coming into focus ahead of the end of his current term as MD and CEO. HDFC Bank said it has shortlisted two candidates for the position of managing director (MD) and chief executive officer (CEO), based on the recommendations of its Governance, Nomination and Remuneration Committee, with the names submitted in order of preference to the RBI.
The potential appointment of Bagchi would bring significant experience from the ICICI Group to HDFC Bank, which currently operates as the country's largest private sector lender. UBS analysts believe that the leadership worries will be resolved soon after the submission of names to the RBI for the CEO position, which in turn could lead to a rerating, as reported by ET Now. The brokerage expects HDFC Bank's loan growth to improve to 15% over FY27-29, while margins could recover cyclically from here towards 3.5%. Macquarie views an external CEO appointment as the primary catalyst for a stock re-rating, while Nomura maintains its 'Buy' rating on the stock with a target price of ₹950, implying more than 28% upside potential from current levels. Despite recent gains, HDFC Bank shares remain down around 25% so far in 2026 and continue to trade below their levels at the start of the year, with the bank's market capitalisation standing at around ₹11.4 lakh crore. Gaurang Shah of Geojit Financial noted that HDFC Bank was underperforming because of the resignation of higher-designated individuals, with the latest being the CEO, adding that "it is one of the cheapest stocks in the banking and finance space."
