Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

On Jun 4, 2013, we reaffirmed our Neutral recommendation on HDFC Bank Ltd. (HDB - Analyst Report). This was based on the company’s impressive fiscal fourth-quarter results, despite the looming concern of higher operating expenses.

Why Neutral?

HDFC Bank’s fiscal fourth-quarter 2013 (ended Mar 31) net profit of INR18.90 billion ($0.35 billion) rose 30.1% year over year. Results benefited from increased revenues, partially offset by higher operating expenses. Moreover, the company reported significant growth in deposits and loan balances.

The estimates over the past 30 days have remained stable for both fiscal 2014 and fiscal 2015. The Zacks Consensus Estimate for fiscal 2014 and fiscal 2015 is $2.00 and $2.60 per share respectively. Hence, with the Zacks Consensus Estimate remaining steady, HDFC Bank now has a Zacks Rank #3 (Hold).

HDFC Bank remains focused on maintaining robust earnings growth through conservative risk management techniques and low-cost funding. Additionally, the Retail Banking segment is expected to be the main driver for future growth. With its extensive branch network and strong brand equity, the company has been able to garner a large share of the retail credit market.

Increasing operating expenses is plaguing factor for HDFC Bank, as it is expected to drag the company’s bottom line in the upcoming quarters. We expect the company’s widening branch network, together with high inflation to keep operating expenses steep in the near term.

Other Foreign Banks Worth Considering

Better performing foreign banks include Mitsubishi UFJ Financial Group, Inc. (MTU - Analyst Report), Deutsche Bank AG (DB - Analyst Report) and Credit Suisse Group AG (CS - Snapshot Report). While the first stock carries a Zacks Rank #1 (Strong Buy), the other 2 carry a Zacks Rank #2 (Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
BITAUTO HOLD BITA 35.33 +14.82%
ANI PHARMACE ANIP 24.79 +14.66%
E HOUSECHINA EJ 10.99 +9.24%
CANADIAN SOL CSIQ 26.97 +7.15%
INTERNATIONA ICAGY 33.30 +5.38%