HDFC Bank Shares Fall 2.3% After Q2 Results; Jefferies, PL, JM, Emkay See Up To 44% Upside, Better Than FDs?

HDFC Bank's share price plunged more than 2% on October 19th, after its Q2 results for FY27. Despite the latest bearish trend, major brokerages have recommended BUY on HDFC with the highest target price at Rs 1,050 per share. This makes HDFC Bank more attractive than its own FD schemes offered to customers, with a potential of over 44% upside going ahead.

HDFC Bank Share Price:

At the time of writing, the HDFC Bank share price traded at Rs 713.30 apiece on BSE, down by 2.03% with a market cap of Rs 10,99,808.55 crore. HDFC has crashed by at least 2.3% to hit an intraday low of Rs 711.50 apiece compared to its previous session's closing price of Rs 728.10.

In Q2FY27, HDFC Bank earned a net profit of Rs 19,510 crore, registering a growth of 4.7% YoY owing to weaker treasury income and a surge in provisions for gross NPA. PAT excluding treasury trading gains, grew by approximately 12.6% over the quarter ended September 30, 2025.

The bank's net interest income (NII) stood at Rs 34,620 crore, registering a growth of 9.7% YoY. Net interest margins came in at 3.16%. On the other hand, HDFC's provisions climbed sharply by 18.7% QoQ to Rs 3,574 crore, while its gross NPA stood at 1.11% of gross advances in Q2FY27.

While Q2 results of HDFC were broadly in-line with estimates, it was the exit of Kaizad Bharucha from his post that came as a shocker.

As per the regulatory filing, Bharucha who is currently the deputy managing director at HDFC Bank has requested cessation of his post at the bank with effect from December 31, 2026.

During his term, HDFC Bank said that Bharucha played a significant role in the Bank's growth and institutional development and made an enduring contribution to the strength and resilience of its business. The Directors particularly acknowledged that the Bank's robust credit architecture has been one of its defining institutional strengths and recognised Mr. Bharucha as one of the principal architects who helped conceptualise, establish and develop this framework.

The first task for the new MD and CEO, Anup Bagchi at HDFC Bank looks like to contain major leadership transition at the largest bank of India.

"We believe the appointment of a new MD and CEO should resolve the prolonged succession overhang and help restore customer and investor confidence. Following the stock's sustained underperformance, valuations have turned attractive, offering scope for a sustained re-rating as the new leadership makes progress on key priorities and geopolitical uncertainties ease, potentially moderating or reversing FPI outflows," said analysts at Emkay Global in a note.

Nonetheless, the majority of brokerages have still recommended BUY on HDFC Bank for its financial performance in Q2 and positive outlook ahead.

BUY HDFC Bank Share Price?

Brokerage / Analyst	Rating Call	Target Price (₹)	Potential Upside
Jefferies	BUY	₹880	20.86%
Emkay Global	BUY	₹1,050	44.21%
PL Capital	BUY	₹950	30.48%
JM Financial	BUY (upgraded from ADD)	₹850	16.74%
Calculation: Potential upside = {Target Price} - ₹728.10) / ₹728.10\) × 100.

"Credit quality stays robust with provisions at 46bps of avg loans. Retail deposit growth was softer at 11% YoY and a pick-up here, along with re-risking of loans towards retail/BB will be key to improvement in NIM and ROA. New CEO & exit of DMD may lead to more changes in mgt-team. We tweak estimates and see ROE of 14% in FY28; stay with BUY call," said Jefferies in their note. They have maintained a target price of Rs 880, which signals at 21% potential upside ahead compared to the previous session's closing price.

Analysts at Emkay Global have assigned the highest target on HDFC Bank, at Rs 1,050 with BUY rating, signaling at over 44% potential upside ahead.

Emkay's analysts said, "Loan growth improved further to 16.4% yoy, driven by broad-based growth across segments and a pickup in retail, while growth excluding FCNR(B) leverage remained healthy at 14.4% yoy. Deposit growth was strong at 18.8% yoy/4.9% qoq, supported by FCNR(B) flows. NIM declined by 8bps qoq to 3.3% due to FCNR(B) funding and stable COF; the recent rate hike should provide support, partly offset by the full-quarter impact of FCNR(B), keeping margins broadly stable in 3Q."

Furthermore, analysts at PL Capital said, "As per our calculations, adjusted for FCNR, NIM would have been flat to positive QoQ. Floating rate book is 70% of loans and rate hike of 25bps in Oct'26 will be factored in in Dec'26. As per bank, NIM has bottomed out; NIM from next quarter would be supported by impact of rate hike and favorable shift towards retail/MSME lending over corporate and home loans." Accordingly, they recommended BUY with target price of Rs 950. They believe Anup Bagchi's strategy for the bank would be a key monitorable.

Moreover, JM Financial upgraded their rating to BUY from ADD with target price of 850. Their note said, "Despite near-term growth constraints from a low LCR (~113%) and elevated CD ratio (~96%), we remain positive on medium-term NIM recovery, driven by the run-off of high-cost borrowings and repricing of the floating rate loan book. With pristine asset quality and valuations becoming attractive following the stock correction, we are upgrading HDFC Bank to BUY from ADD."

HDFC Bank Shares Vs FD Returns

Taking into consideration the highest rating of Rs 1,050, HDFC Bank will likely rise by more than 44% in the next 12 months. This is far better growth on investment of Rs 1,00,000 in HDFC stock than compared to Rs 1 lakh FD at the bank. HDFC Bank offers 6.25% interest rate to general category and 6.75% rate to senior citizens on 1 year to less than 15 months tenure.

HDFC Bank vs Fixed Deposit: ₹1 Lakh Investment
Particulars	HDFC Bank Shares	FD (General Citizen)	FD (Senior Citizen)
Initial investment	₹1,00,000	₹1,00,000	₹1,00,000
Expected return rate	44.21%	6.25%	6.75%
Potential gain in 1 year	₹44,207	₹6,250	₹6,750
Total value after 1 year	₹1,44,207	₹1,06,250	₹1,06,750

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