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HDFC Bank Q2 FY22 Preview: HDFC Bank’s retail loan growth picks up, asset quality may improve: What to expect



HDFC Bank Q2 results to be declared tomorrow

The country’s largest private lender HDFC Bank will announce the July-September quarter results for the financial year 2021-22 tomorrow-Saturday (October 16). Leading brokerage and financial services company Emkay Global Financial Services in its recent report said that the bank has registered a better-than-expected credit growth of 15 per cent year-on-year. According to the report, the asset quality of HDFC Bank is likely to improve in the second quarter of the current financial year.

The bank’s deposit growth was steady at 14 per cent year-on-year and CASA deposit growth was strong at 29 per cent year-on-year – a growth seen in large banks, partly under the Reserve Bank of India. Benefit from instruction. To maintain current accounts with the main lender.

The Emkay Global report said that the CASA ratio remains at a high of 47 per cent and with retail lending picking up, HDFC Bank is likely to report better margins sequentially in the upcoming quarterly results.

The central bank lifted restrictions on HDFC Bank’s credit card business in August 2021. Since then, since the bank was delisted, the bank has issued over 4 lakh credit cards.

According to Emkay Global, HDFC Bank stock has underperformed due to the cumulative impact of management change, allegations of misconduct in the auto business, pandemic-induced/asset quality disruption and restrictions on credit card business by RBI.

Emkay Global in its report said, however, the pick-up in retail credit growth, lifting of restrictions on credit card business and expected moderation in NPA formation should provide relief.

Presently, Emkay Global maintains a ‘Buy’ rating on the stock with a target price of Rs 1,850, given its proven track record in managing asset quality across cycles, strong capital profile and delivering superior return ratios .

On Thursday, October 14, HDFC Bank’s shares closed at Rs 1,685.90, up 2.86 per cent on the BSE. Shares of HDFC Bank on Thursday hit a 52-week high of Rs 1,690, ahead of the earnings announcements.


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