Goldman Sachs has maintained its Buy rating on HDFC Bank, projecting a 28% upside with an increased target price of Rs 2156. The bank posted in-line core operating profits and exceeded PAT expectations for Q2 FY25, highlighting strong operational quality and visibility of future earnings.
Goldman Sachs pointed out that Pre-Provision Operating Profit (PPOP) Return on Assets (RoA) increased by 5 basis points quarter-on-quarter, marking a second consecutive quarter of improvement. The bank’s PAT exceeded street estimates by 10%, driven by provisions coming in 10% below expectations.
In addition, management laid out plans to consolidate the bank’s Loan-Deposit ratio, further improving credit growth. Following the merger with eHDFC Ltd, the bank saw its RoA expand to 1.9%, bolstering its growth outlook.
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