The stock of India’s largest private lender climbed as much as 2.7% on Monday to make an intraday high of ₹793.5. The stock had gained nearly 4% on Friday as well as a short-covering rally in India’s markets on hopes of a US-Iran peace deal had sent banking stocks soaring.
Despite this recovery, shares of HDFC Bank have been underperformers so far in 2026, having declined over 20% so far this year, and have just managed to recover over 8% from its 52-week low of ₹726.65, which the stock had dropped to on April 2.
Also read: RBI to bear full hedging cost on fresh FCNR(B) deposits till Sept 30 to attract dollar inflows
Nomura Remains Bullish
Nomura maintained its “Buy” rating on HDFC Bank with a price target of ₹950 per share, implying a potential upside of nearly 23% from the previous closing level.
The brokerage said concerns that have weighed on HDFC Bank’s stock, including deposit growth lagging expectations, a credit-deposit ratio above management guidance, the lowest liquidity coverage ratio (LCR) among large private-sector peers, and higher reliance on short-term wholesale funding, are not separate issues.
According to Nomura, these concerns are essentially different manifestations of the same funding challenge and could potentially be addressed through a single solution.
The brokerage believes the RBI’s FCNR(B) scheme could provide that opportunity, positioning HDFC Bank as a key beneficiary of any increase in foreign currency deposit inflows.
Nomura estimates that HDFC Bank could attract around 15% of the total FCNR(B) inflows, equivalent to roughly 3% of its current deposit base.
Is HDFC Bank A Buy Or Sell?
HDFC Bank shares, despite the underperformance, is a “consensus buy” among all 47 analysts that have coverage on the stock. Based on the consensus projections of price targets, the stock has an average target of ₹1,048, which implies a 33% upside from current levels.
Shares of HDFC Bank are trading 1.5% higher on Monday at ₹784.7.
