HDFC Bank stock remains a favoured pick among several major brokerages despite concerns over weak earnings growth and pressure on net interest margins following its Q2 FY27 results. JPMorgan and Citi have cut their target prices while retaining bullish ratings, whereas Bernstein sees a potential upside of nearly 58 percent from Friday's closing price.
The contrasting assessments follow HDFC Bank's July-September quarter earnings, which broadly met market expectations. The private sector lender reported a 4.7 percent year-on-year increase in standalone net profit to Rs 19,510 crore, while net interest income (NII) grew 9.7 percent to Rs 34,619 crore.
A CNBC TV18 poll had estimated net profit of Rs 19,567 crore and NII of Rs 34,861 crore. The bank's gross non-performing asset (GNPA) ratio improved to 1.11 percent from 1.17 percent in the preceding quarter, while gross advances grew 16.3 percent year-on-year.
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However, margin pressure, modest profitability growth and questions over the sustainability of loan expansion have prompted brokerages to adopt differing views on the bank's earnings outlook.