HDFC Bank witnessed substantial institutional trading activity on the National Stock Exchange (NSE) with a significant block trade transaction. The banking major saw considerable market interest through this large-volume trade execution.

Block Trade Details

The block trade executed on NSE represented a substantial transaction for the private sector banking giant. The trade specifics highlight the scale of institutional participation in the stock.

Market Significance

Block trades represent off-market transactions typically executed by institutional investors, mutual funds, insurance companies, or other large market participants. These transactions allow large volumes to be traded without significantly impacting the regular market price discovery mechanism.

The transaction value of ₹94.91 crores indicates substantial institutional interest in HDFC Bank shares. Such block trades are often pre-negotiated between buyers and sellers and executed at predetermined prices.

Transaction Analysis

The block trade involved approximately 1,028,303 shares at ₹923.00 per share, demonstrating significant market activity. Block trades are typically used when large investors need to execute substantial transactions while minimizing market impact and maintaining price stability.

This trading activity reflects the continued institutional participation in one of India's leading private sector banks, showcasing the stock's liquidity and investor interest in the banking sector.

Prabhudas Lilladher has reiterated its buy recommendation on HDFC Bank with a target price of ₹1,150, following the bank's impressive quarterly performance that exceeded analyst expectations across key metrics.

Strong Quarterly Performance Drives Positive Outlook

The bank delivered a robust quarter with core profit after tax (PAT) reaching ₹156.50 billion, surpassing Prabhudas Lilladher's estimates by 5.9%. This outperformance was primarily attributed to lower provisions, which helped boost the bottom line significantly.

Asset Quality and Operational Metrics Show Improvement

HDFC Bank's asset quality remained healthy during the quarter, supported by lower net slippages and a contingent provision reversal of ₹10.40 billion. This reversal was driven by improved credit performance from a large corporate client, demonstrating the bank's effective risk management capabilities.

Net interest income (NII) came in 1.2% ahead of estimates, led by better reported net interest margin (NIM) which increased by 8 basis points quarter-on-quarter. This performance compared favorably to ICICI Bank, which maintained stable NIM during the same period.

Growth Projections and Strategic Outlook

The bank expects the banking system to grow by 12-13% in FY27E and has maintained its guidance of growing above system levels. HDFC Bank's loan-to-deposit ratio (LDR) is projected to reach approximately 90% as part of its strategic growth plans.

However, Prabhudas Lilladher expresses some caution regarding the bank's ambitious growth targets. The brokerage factors in a loan compound annual growth rate (CAGR) of approximately 12% over FY26-28E, noting that to meet its guidance, the bank would need to capture an incremental deposit market share of over 20%, which may prove challenging in the current operating environment.

Valuation and Investment Recommendation

Prabhudas Lilladher maintains its sum-of-the-parts (SOTP) based target price of ₹1,150, applying a multiple of 2.5x on September 2027 core adjusted book value (ABV). The brokerage retains its 'BUY' rating on the stock, reflecting confidence in the bank's fundamental strength and growth prospects despite some concerns about deposit market share capture in the competitive banking landscape.