HDFC Bank shares recovered 1.69% to ₹703.95 on Friday following Thursday's decline of 1% to ₹684.25 after the Reserve Bank of India's decision to raise the repo rate by 25 basis points to 5.50% from 5.25%. The stock opened at ₹696.60 and touched an intraday high of ₹706.40, though selling pressure remained dominant at 61.31% of total traded volume. Traded volume stood at 99.47 lakh units with a traded value of ₹698.47 crore, while the company's market capitalisation was ₹10,85,392.16 crore with an adjusted price-to-earnings ratio of 13.32.
HDFC Bank shares are set to be in focus on October 8 as the latest shareholding pattern data showed that foreign investors cut their stakeholding in the private sector lender. This development adds to the existing challenges facing the bank, which has already seen HDFC Bank shares drop nearly 29% this year following the resignation of former part-time Chairman Atanu Chakraborty. The stock had hit a 31-month low of ₹681.90 on September 11, with the appointment of Anup Bagchi as the new MD and CEO providing significant relief and brokerages now seeing up to 74% upside potential after the leadership transition. The latest foreign investor stake reduction compounds the existing pressure on the stock, which remains just 3.5% away from their recent 52-week low.
HDFC Bank reported loan growth of 16.3% during the September quarter, while deposit growth outpaced loan growth with an 18.8% year-on-year figure. According to IIFL's Rikin Shah, the bank's September quarter business update was marginally better than expectations but most of its peer banks had a significant beat when compared to estimates. Shah explained that HDFC Bank has not mobilized as much FCNR (B) deposits compared to its balance sheet size, which is a key factor contributing to the stock's underperformance. The core corporate loan growth has been stronger than other banks, potentially making core margins tad soft from a quarterly perspective. Shah noted that some long-short investors made it a funding short on Monday, October 5, citing relative performance concerns versus other private banks.
Despite Friday's uptick, HDFC Bank remains deeply under pressure with a year-to-date loss of nearly 29% and around 28% decline over the past year. The stock's 52-week high was ₹1,020.50 recorded on October 23, 2025, against a 52-week low of ₹681.90 hit on September 11, 2026. Brokerages expect further rate hikes, with Goldman Sachs seeing the terminal repo rate at 6.25% and Kotak Securities anticipating 50 basis points of additional tightening. However, Bernstein rates HDFC Bank 'outperform', citing the stock as having the largest valuation gap and upside among Indian private-sector banks, alongside ICICI Bank and Axis Bank. Despite the positive CEO appointment and Q2 business update, 47 out of the 49 analysts who cover HDFC Bank have a 'buy' rating on the stock, indicating strong institutional confidence.
