HDFC Bank Ltd. shares demonstrated resilience in Monday's trading session, gaining ground even as Managing Director and CEO Sashidhar Jagdishan announced his decision not to seek reappointment. The stock traded 2.02 percent higher at Rs 734.55 apiece, reflecting investor confidence despite the leadership transition.
Foreign brokerages, including UBS, Bernstein, Macquarie, Morgan Stanley, Nomura, and Jefferies, largely reiterated their 'Buy' or 'Outperform' ratings on the HDFC Bank stock. Domestic firms such as ICICI Securities, Antique Stock Broking, Axis Capital, Nuvama, and MOFSL also maintained their positive outlooks.
Brokerage Ratings and Price Targets
- UBS: Alok Srivastava retained a 'Buy' rating with a target price of Rs 1,130.
- Bernstein: Pranav Gundlapalle maintained an 'Outperform' rating with a target price of Rs 1,150, one of the highest among brokerages post-CEO decision.
- Macquarie: Suresh Ganapathy also held an 'Outperform' rating, aligning with Bernstein's Rs 1,150 target.
- Morgan Stanley: Subramanian Iyer kept an 'Overweight' rating, setting a target price of Rs 1,025.
- Nuvama: This domestic brokerage retained a target price of Rs 875, noted as the lowest among current evaluations.
- Axis Capital: Maintained a target of Rs 1,020.
- Other Domestic Firms: Antique Stock Broking, Nomura, ICICI Securities, and Jefferies set targets of Rs 1,025, Rs 950, Rs 920, and Rs 880, respectively.
Analysts indicated that Jagdishan's decision was anticipated by some, particularly given the challenges of securing a term extension from the Reserve Bank of India (RBI) amidst recent operational and governance issues. The board's swift action to initiate the selection process for a new CEO is viewed positively, with a timely conclusion expected to refocus investor attention on the bank's strong fundamentals.
Sashidhar Jagdishan has been a long-standing figure at HDFC Bank, joining in 1996 and previously serving as Chief Financial Officer. He assumed the MD & CEO role on October 27, 2020, succeeding Aditya Puri. His tenure notably included overseeing the complex reverse merger of HDFC Ltd. with HDFC Bank, effective July 1, 2023.