HDFC Bank
NSE: HDFCBANK•Banking & Financial Services
Current Price
₹1,720
TECH-FUNDA™
Strong
India's largest private-sector lender with industry-leading CASA ratio, pristine asset quality, and nationwide digital branch distribution.
Price to Earnings (P/E)
18.4
Trailing Twelve Months
Return on Equity (ROE)
16.8%
Shareholder Capital Return
Price to Book (P/B)
2.6x P/B
Asset Backing
Enterprise Multiple
N/A (Banking)
EV / EBITDA
Fundamental Quality Core
3-Stage DuPont ROE Decomposition
ROE = Net Margin × Asset Turnover × Equity Multiplier
1. Operating Margin
21.4%
Operating efficiency and pricing power translation to net earnings.
2. Asset Turnover
0.10x
Capital velocity; revenue generated per rupee of assets deployed.
3. Financial Leverage
7.85x
Total assets divided by net worth; leverage multiplier to equity.
DuPont Assessment: High financial leverage typical of Tier-1 banks, balanced by superior credit cost control and low NPA provisioning.
01 · BUSINESS
Business Quality & Moat
Competitive Moat: Massive low-cost CASA deposit franchise and conservative underwriting culture.
Pricing Power: High pricing discipline across retail loans and corporate credit lines.
Growth Catalysts: Post-merger mortgage cross-selling and semi-urban branch penetration.
02 · FUNDAMENTALS
Financial & Balance Sheet
Balance Sheet Health: Gross NPA consistently maintained below 1.4% with adequate provision coverage.
Cash Flow Dynamics: High net interest income compounding; stable net interest margins (NIM) around 3.4-3.6%.
Capital Discipline: Strong capital adequacy ratio (CAR > 18%) comfortably exceeding RBI regulatory buffers.
03 · VALUE
Valuation Intelligence
Price Multiple Context: Trading at 18.4 P/E and 2.6x P/B.
Historical Benchmark: Trading below its 10-year historical mean price-to-book valuation multiple.
04 · RISK
Risk & Downside Watch
Corporate Governance: Stable institutional oversight with clear board succession architecture.
Execution Headwinds: Smooth integration of mortgage book liabilities post-parent amalgamation.
Economic Sensitivity: Low retail delinquency risk across credit cycles.
TECH-FUNDA™ RESEARCH PIPELINE
Market Filter→Business Moat→DuPont ROE→Valuation Margin→Active Thesis