Shares of HDFC Bank Ltd witnessed a surge early Wednesday, following a merger with HDFC that resulted in a quarter-on-quarter loan book growth to ₹23.55 lakh crore. The combined entity's advances and deposits increased significantly to ₹21.73 lakh crore.
Home loan disbursals from the bank reached a record high of ₹48,000 crore (INR100 crore = approx. USD12 million). According to InvestingPro data, the bank's market cap stands at a solid $434.26 million, with a promising P/E ratio of 2.86, indicating a potentially undervalued stock. The bank's shares traded 0.93% higher at ₹1,522 on BSE from a previous close of ₹1,507.95, despite experiencing a yearly loss of 7%.
In response to the expanding branch network and mortgage book, the bank has initiated a management reshuffle, which has led to a CASA ratio of 37.6%. InvestingPro Tips highlight that HDFC Bank has been consistently increasing its earnings per share and has raised its dividend for three consecutive years, which is backed by the bank's impressive dividend yield of 32.62% as per InvestingPro data.
The stock fell below the 200-SMA with a P/E ratio of 24.25 and a 14-day RSI at 34.92. Interestingly, the InvestingPro Tips suggest that the RSI indicates the stock is in oversold territory, which might present a buying opportunity for investors.
The scrip carries an analyst target price of ₹1,984 and exhibits a one-year beta of 1.21, indicating potential volatility in comparison to the market as a whole. However, the InvestingPro data shows a promising return on assets of 4.45% and a revenue growth of 77.37%, which might be appealing to potential investors.
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