HDFC Bank share price: Shares of India’s largest private lender, HDFC Bank, have crashed over 25% year-to-date (YTD) and are down nearly 33% from its 52-week high of ₹1,020.
HDFC Bank share price witnessed a downfall, snapping a two-day rise in Thursday’s trading session, falling over 1% to ₹730.20 per share on NSE. The private lender stock opened at ₹725 today, as compared to previous close of ₹737.25 on Wednesday.
Why HDFC Bank share price has been falling?
According to Seema Srivastava, Senior Research Analyst at SMC Global Securities, this fall in the stock is not just about numbers but a full-blown corporate governance crisis.
Srivastava explained the four core flashpoints. First, former Chairman Atanu Chakraborty resigned 14 months early, stating the bank’s practices did not match his ‘values and personal ethics’, triggering transparency fears. Second, a succession crisis emerged as MD & CEO Sashidhar Jagdishan declined an extension, raising leadership stability questions for institutional investors. Third, an internal inquiry flagged ‘business overreach’ where marketing budgets were allegedly used for indirect discounts to meet aggressive deposit targets. Fourth, overseas branches faced regulatory scrutiny over mis-selling of wealth products and an aggressive sales culture.
Meanwhile, Q1 FY27 fundamentals also remained fortress-like. Total deposits crossed ₹31.7 lakh crore, up 14.7% YoY, GNPA stands at just 1.17% and NNPA at 0.41%, showing no deterioration in core asset quality, while Capital Adequacy at 19.6% and PAT of ₹19,060 Cr provide a resilient cushion.
“Valuation tells the story of de-rating. Historically HDFC Bank commanded 3.5x-4.2x Price-to-Book for its trust and governance premium; it now trades at just 2.37x P/BV, meaning the market has already priced in the governance discount,” she added.
Opportunity for bottom fishing ahead of new CEO appointment?
HDFC Bank is yet to name its next Managing Director and CEO, though the long-awaited decision could be announced soon.
The bank’s board has already sent two candidates to the Reserve Bank of India (RBI) for approval, ranked by preference, for a three-year tenure. However, HDFC Bank has not publicly revealed the names of the candidates.
Anuj Gupta, SEBI Registered Research Analyst, believes that the expected change in management could provide an opportunity to hold on to HDFC Bank shares, as a transition in leadership may support investor sentiment and the stock price. The new management could bring a fresh approach to the bank, particularly at a time when concerns around corporate governance and compliance have been weighing on sentiment.
“From a technical perspective, the stock is trading close to a key support zone. The ₹700 level is likely to act as an important support, followed by stronger support around ₹650. If the management transition improves market confidence and the stock sustains above these levels, there could be scope for a recovery in the share price,” Gupta said.
Meanwhile, Mahesh M Ojha, VP Research & Business Development at Kantilal Chhaganlal Securities, said that given the current market conditions, it may not be the best time for investors to take aggressive positions.
“For those with a medium- to long-term investment horizon, the current weakness could offer an opportunity to accumulate the stock gradually,” Ojha said.
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
