Why is HDFC Bank No 1?
HDFC Bank has been at the forefront in leveraging technology to give its 43 million customers a superior banking experience. The journey to become a digital banking forerunner began in 2014, with the launch of its 'Bank Aapki Muthhi Mein' campaign from the banks of the Ganges.
HDFC Bank is the largest bank in India in terms of market cap and the fourth-largest bank in the world on the same terms. As one of the leading private banks in India, it holds a prominent position in the financial industry.
The domestic brokerage said number of branches opened in past three years are superior in case of HDFC Bank over ICICI Bank, adding that HDFC Bank's branch presence are also far more granular than ICICI Bank's.
HDFC's success can be attributed to several factors. The bank's technology-driven approach allowed it to provide seamless and efficient services to its customers. The bank's Internet banking and mobile banking services allowed customers to carry out transactions and access their accounts from anywhere and at any time.
HDFC Bank enables seamless delivery of home loans as a part of its wide product suite catering to urban, semi urban and rural India. As of December 31, 2023, the Bank's distribution network was at 8,086 branches and 20,688 ATMs / Cash Recycler Machine (Cash deposit & withdrawal) across 3,836 cities / towns.
In India, HDFC Bank has continuously been ranked among the best banks in terms of both assets and client happiness. The Reserve Bank of India (RBI) controls the bank, ensuring that it follows strict financial laws and security procedures.
Which bank is the safest bank in India? The Reserve Bank of India (RBI) regulates the safety of banks in India. Among the prominent banks known for their stability and safety measures are the State Bank of India (SBI), HDFC Bank, ICICI Bank, and Punjab National Bank (PNB).
Also, on the yield front, HDFC Bank has superior access against ICICI Bank on unsecured retail & SME/MSME loans front amid a wider branch network and improved rural/semi-urban reach, it said.
Its Liquidity Cover Ratio (LCR) fell to 109.8 per cent from 120 per cent QoQ due to a drawdown of liquid assets to fund loan growth. The bank's loan-to-deposit ratio (LDR) rose from 108.4 per cent to 110.5 per cent QoQ. The LDR for standalone HDFC Bank was 89 per cent in Q3FY24 versus 85 per cent in Q1FY24.
According to an investor presentation on its website, HDFC's net worth, which earlier stood at ₹1.34 trillion as of 31 March 2023, will now be lower at ₹1.11 trillion as of 1 July under the IGAAP financial reporting standards after its merger with the bank.
Is HDFC Bank underperforming?
HDFC Bank shares, which have been underperforming Sensex Nifty as well as peers in the last two years, fell up to 9% to day's low at Rs 1,527 on BSE, eroding over Rs 1 lakh crore or $12 billion wealth in the process.
The merger has come about to serve client needs better and adapt to the changing needs of the broader industry. Post-merger, HDFC Bank is currently the 11th largest lender in the world and the largest bank in India.
HDFC Bank's Retail business is targeted at individuals, salaried professionals, micro and small businesses, such as kirana stores, Self Help Groups (SHGs), and Non-Resident Indians (NRIs).
Quick loan disbursem*nt
As an HDFC Bank customer, you no longer have to wait for days to get a loan sanctioned; you can avail instant loans within minutes. And this is applicable for various types of loans, from personal to two-wheeler loans, and even LOCC (Loan On credit card), without much documentation.
But with HDFC Bank's robust safety protocols, you are guaranteed a safe and efficient experience. Since you don't have to log in on a third-party app or website, you can rest assured that the process is 100% safe.
Fixed Deposits up to ₹5 lakh are insured with the Deposit Insurance and Credit Guarantee Corporation of India (DICGC). This makes it an insured asset to have.
In terms of asset quality, HDFC Bank exhibited strength compared to SBI. If we analyse some key ratios useful for evaluating the banking business, let's begin with the Price-to-Book (PB) value. SBI has a PB ratio of 1.63, whereas HDFC's PB ratio is 4.47.
From investment view point, analysts see 45% upside in HDFC Bank and 42% upside in ICICI Bank from a one-year perspective. While Emkay Global opines that ICICI Bank can maintain its outperformance over HDFC Bank if it sustains its core performance and realises top management premium.
Cons: HDFC is having limited free transactions monthly after that they will charge fee for every transaction. The customer:employee ration is low. For example you have to wait for your transaction is most of the branches.
On February 26, 2000, Times Bank Ltd merged with HDFC Bank Ltd. It was the first friendly merger in the Indian banking space and the first through a share swap route. It catapulted HDFC Bank into the big league in terms of business as well as market valuation. This was an appetizer for HDFC Bank.
Is HDFC Bank in debt?
Total debt on the balance sheet as of June 2023 : $32.11 B
According to HDFC Bank's latest financial reports the company's total debt is $32.11 B.
HDFC Bank has a low PEG ratio of 0.5. A stock having PEG less than 1 is considered undervalued and with PEG ratio above 1 is regarded as an overvalued one. HDFC Bank stock is down 12% in a year and fallen 15.11% in 2024.
Future Growth
HDFC Bank is forecast to grow earnings and revenue by 15.5% and 8.8% per annum respectively. EPS is expected to grow by 11.1% per annum. Return on equity is forecast to be 16.5% in 3 years.
The People's Bank of China bought 1.01% (1,74,92,909 crores) shares of HDFC bank.
Sashidhar Jagdishan, HDFC Bank's Managing Director and Chief Executive, has emerged as the highest-paid bank chief executive in FY23, with a significant increase of more than 62% in his remuneration in fiscal year 2023, reaching ₹10.55 crore, the PTI reported.
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