By Aditya Raghunath
Investing.com -- HDFC Bank Ltd (NS: HDBK ) reported its results for the first quarter of FY22 on Saturday. Its standalone profit moved up 16.1% to Rs 7,729.64 crore compared to the same period in FY21. Net interest income grew to Rs 17,009 crore compared to Q1 FY21.
However, India’s largest private sector bank saw a fall in asset quality with gross non-performing assets at 1.47% in Q1 FY22 compared to 1.32% in Q4 FY21. The bank’s results have received a thumbs down from the market and the stock is trading lower by 2.8% at Rs 1,479.65 at the time of this report.
Brokerages, though, are positive on the stock. Motilal Oswal (NS: MOFS ) has given the stock a target price of Rs 1,800. It said that the bank continues to grow its loan book, and its commercial and rural books both show healthy trends.
Goldman Sachs (NYSE: GS ) has a target of Rs 1,803 on the bank’s stock while Morgan Stanley’s target is Rs 2,000. It said, “NIM missed our estimate but was offset by higher fees. Bad loan formation was elevated given second Covid wave. Provisions broadly in-line adjusted for contingency provisions. Reduce EPS estimates by 2%.”
CLSA has a target of Rs 1,850 on the stock. It said, “Commentary on retail and SME asset quality is comforting Loan and NII growth trends will be key to watch. No update on credit card ban which will remain a near-term overhang.”
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