HDFC Bank Limited

Financial Services — Banks - Regional · NSE

₹728.85+₹2.00 (+0.28%)

DalalBaazaar Score

77 / 100

🟢 Good

Verdict

REASONABLE

Risk

Low

No individual risk factor stands out on this snapshot.

In simple words: Reasonable but unspectacular business quality, with both sales and profits growing well. Nothing on this snapshot stands out as an immediate concern — the usual checks on business quality and management still apply.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:02 pm

Understanding the Business

Company site ↗

The 60-second version of HDFC Bank Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

HDFC Bank Limited provides banking and financial products and services to individuals and businesses in India, Bahrain, Hong Kong, Singapore, and Dubai.

IndustryBanks - Regional

SectorFinancial Services

Employees2,12,958

Annual revenue₹1.93 L Cr

How does it make money?

Turns over ₹1.93 L Cr a year. Of every ₹100 of sales, about ₹37 reaches shareholders as profit. Each of its 2,12,958 employees supports ₹90.4 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹90.4 lakh

Who are its competitors?

The closest listed comparisons in its industry are ICICI BANK LTD., KOTAK MAHINDRA BANK LTD, AXIS BANK LIMITED, STATE BANK OF INDIA. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Not assessable from these ratios

For a lender, returns on capital are shaped by leverage and funding cost rather than by pricing power, so the usual financial signature of an advantage does not apply. Judge this one on deposit franchise, cost of funds and asset quality — none of which are in this data.

Peer median ROE15.2%

What is the outlook?

35 analysts covering the stock expect revenue to grow about 50.7% and earnings to grow about 17.6% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+50.7%

Est. earnings growth+17.6%

Analysts35

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +60% while net margin moved -11% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+60%

Margin effect-11%

DalalBaazaar Score

77/ 100

Good

Weighted across six categories. Every point is explained below.

• ROE of 13.8% is moderate
✗ ROE has fallen by 8.4 points over the period

Quality vs. Valuation

Company Quality

80/ 100

Excellent

How good the business is, ignoring the share price entirely.

Valuation

61/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

15.9x

3Y Median

17.8x

40 monthly readings · mean 16.2x · range 7.9x–22.9x

Sector Median

16.3x

median of 4 sector peers

🟢Current valuation is approximately 11% below its 3y median of 17.8x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟡Against its sector it is priced broadly in line with the peer median of 16.3x.

vs. its own history

Fair

17.8x median over 40 months · -11%

vs. sector peers

Fair

16.3x median of 4 peers · -2%

vs. generic bands

Fair

15x–35x

EV/EBITDA

—

PEG

1.28

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on equity is falling
ROE has dropped from 17.0% to 8.6% — each rupee of shareholder capital earns less than it did.

Red Flags

2 items require attention · 2 watch

🟡Shareholders have been dilutedOwnership
Shares outstanding are up 38% over 3 years — each existing share owns a smaller slice of the company.
🟡Low reported insider holdingOwnership
Reported insider holding is 0.2%. For Indian companies this field is an unreliable proxy — check the official promoter shareholding in the exchange filing.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Returns on shareholder capital are falling
ROE has dropped from 17.0% to 8.6%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 13% a year✓ 16.9% CAGR
Latest reported year was 16.6%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2Return on equity stays above 12%✓ 13.8%
For a lender this is the cleanest single read on whether the book is being grown profitably.
3Valuation vs its own median of 17.8x✓ 15.9x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

9 / 10 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 6 neutral · 0 weak

Market Cap

₹11.24 L Cr

Large Cap

Large, widely-covered business — typically the steadiest of the bands

P/E (Trailing)

15.9x

Fair

Fairly valued against the generic band

P/B Ratio

1.91x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹45.75

Profitable

Profitable on a per-share basis

ROE

13.8%

Moderate

Moderate capital efficiency

ROCE

Not meaningful

N/A for lenders

Banks and NBFCs don't report capital employed the way other businesses do

Debt/Equity

0.81x

Moderate

Moderate leverage

Revenue Growth (YoY)

16.6%

Healthy

Healthy top-line growth

Profit Growth (YoY)

18.1%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.78%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹1.07 L Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

11.6x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

ROA

1.8%

Weak

Assets generate little profit

Operating Margin

33.3%

Good

Healthy core-business profitability

Net Margin

26.8%

Good

Strong bottom-line conversion

Beta (vs Nifty)

0.41

Defensive

Steadier than the market

52W Range Position

14%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

719.3 / 718.5

Bullish alignment (short > long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

47.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1.21 L Cr	₹1.60 L Cr	₹1.84 L Cr	₹1.93 L Cr	+16.9%
PAT (Net Profit)	₹49,545 Cr	₹62,266 Cr	₹67,351 Cr	₹70,479 Cr	+12.5%
EPS	₹88.68	₹44.16	₹44.82	₹45.75	-19.8%
ROE	17.0%	9.0%	8.8%	8.6%	—
Total Debt	₹3.15 L Cr	₹8.09 L Cr	₹7.33 L Cr	₹6.64 L Cr	+28.2%
Free Cash Flow	₹43,358 Cr	₹96,848 Cr	₹1.13 L Cr	₹1.07 L Cr	+35.0%

🟢 Revenue has grown at 16.9% a year over 3 years.

🟢 PAT (Net Profit) has grown at 12.5% a year over 3 years.

🔴 EPS has shrunk at 19.8% a year over 3 years.

🔴 ROE has fallen from 17.0% to 8.6% over 3 years (-8.4 pts).

🔴 Total Debt has grown at 28.2% a year over 3 years.

🟢 Free Cash Flow has grown at 35.0% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹52.62 L Cr

Total Liabilities

₹43.46 L Cr

Cash & Equivalents

₹3.65 L Cr

Operating Cash Flow

₹1.12 L Cr

Capex

-₹5,278 Cr

Shareholding (proxy)

Institutional Holding

61.2%

Insider Holding

0.2%

Corporate Actions

Next Earnings

16 Jan 2027

Dividend Rate

₹13

Ex-Dividend Date

19 Jun 2026

Analyst Consensus

Recommendations

39 Buy · 2 Hold · 0 Sell

Target Price (Mean)

₹977.29

+34.1% vs CMP

Target Range

₹800 – ₹1,270

Peer Comparison

Company	P/E	ROE
ICICI BANK LTD.	18.1x	16.5%
KOTAK MAHINDRA BANK LTD	21.9x	11.2%
AXIS BANK LIMITED	14.5x	13.4%
STATE BANK OF INDIA	10.3x	15.2%

Recent News

4 mixed2 general

HDFC Bank Stock Falls 2%, Yes Bank Shares Up 2% : Should You Buy Either Private Bank Stocks After Q2?

Goodreturns, 17 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

ICICI Bank vs HDFC Bank vs Axis Bank: Which stock to buy, sell or hold after Q2 results?

Livemint, 18 OctResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

HDFC Bank Q2 preview: Single-digit PAT growth likely; margin pressure seen

Business Standard, 16 OctResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

HDFC Bank PAT ticks up 5% amid pressure

The Economic Times, 18 Oct

HDFC Bank Q2 results: Net profit likely to remain flat despite strong loan growth; key focus on NIM and leadership transition

Upstox, 16 OctResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

A new era for Indian banking

The Economist, 17 Oct

Watch Items

This is a financial-sector business: borrowing is its raw material, not leverage in the usual sense. Debt/Equity and ROCE here aren't comparable to a manufacturer's — read them alongside NIM, GNPA and capital adequacy from the company's own disclosures.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
Reported insider holding is low — cross-check the official promoter shareholding % in the company's exchange filing.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Risk

MiddlingProfitability · Valuation

Points for each in the Score ↑

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself.

All 3 tripwires holding · see Key things to watch ↑