Jefferies India Raises HDFC Bank Target to ₹880 After New CEO Appointment
Jefferies India has issued a 'buy' rating on HDFC Bank shares, setting a price target of ₹880 based on the appointment of Anup Bagchi as the new Managing Director and CEO. The brokerage sees a potential 22% upside from current levels, despite the stock having declined over 27% year-to-date and more than 6% in the past six months.
The report highlights that the approval of Anup Bagchi by the Reserve Bank of India brings clarity on management succession and strategic direction. Jefferies believes this opens opportunities for the bank to improve retail deposit growth, enhance cross-sell fee income, and rebalance its loan mix toward higher-risk-adjusted segments.
HDFC Bank has lagged peers in LCR retail deposit growth at 12%, compared to 15% for ICICI Bank and 14% for SBI. However, the bank has shown a strong rebound in FCNR-B deposits, mobilising $11-12 billion within two months, which Jefferies notes could help refinance high-cost borrowings at lower rates.
On fee income, the report points out that growth in credit card fees, third-party product income, and retail liabilities has slowed to 8% and 11% YoY in the last two quarters. Improvement in these areas, particularly bancassurance—which contributed 8% of FY27 pretax profits—could boost ROA.
Jefferies also notes that HDFC Bank’s loan book has seen increased exposure to PSU lending and corporate secured segments, which has pressured net interest margins. However, with around 70% of loans linked to EBLR or floating rates, the bank may benefit from future rate hikes if it shifts toward SME, business banking, gold, and unsecured personal loans.
Valuation-wise, Jefferies maintains that HDFC Bank’s valuation gap with peers like ICICI, Kotak, Axis, and SBI has been disrupted since March 18, 2026. With CEO succession resolved, a timely team reorganisation could support a re-rating. The ₹880 target is based on 1.6x September 2028E price-to-book ratio.
For the HDFC Bank ADR trading on the NYSE, Jefferies has set a price target of $28, implying around 25% upside from the current level of $22.34. The brokerage expects the ADR to reflect similar upside potential as the domestic shares.
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