HDFC Bank shares on a record breaking run, market cap tops Rs 14 lakh crore

HDFC Bank shares have been on a remarkable upward trajectory, reaching new record highs for the fourth consecutive session on Thursday. As a result of today’s rally, the bank’s market capitalization surged past the Rs 14 lakh crore mark for the first time on both BSE and NSE. In the past five trading sessions, the stock has seen a gain of 5.4%.

On Thursday, HDFC Bank’s stock touched a record price of Rs 1836.10, despite a broader market correction. The bank’s market cap stood at Rs 14.01 lakh crore by the end of the day.

During the afternoon session, the market cap of HDFC Bank was recorded at Rs 13.80 lakh crore on the BSE, with 1.74 lakh shares traded, amounting to a turnover of Rs 32.11 crore. The stock has a one-year beta of 1, suggesting it has average volatility.

In the previous sessions, HDFC Bank had reached record highs of Rs 1817.50 on November 27, Rs 1804.10 on November 26, and Rs 1801.90 on November 25. Notably, the stock breached the Rs 1,800 mark for the first time on November 25, on an intraday basis.

This week’s rally was largely driven by an anticipated increase in HDFC Bank’s MSCI index weightage, which is expected to attract inflows of $1.9 billion. The MSCI index review for November 2024 became effective from Monday.

The bank’s stock is not in the overbought or oversold zone, as indicated by its relative strength index (RSI) of 65.8. It is also trading above all major moving averages, including the 5-day, 20-day, 30-day, 50-day, 100-day, 150-day, and 200-day averages.

While the stock has gained 5.89% in 2024, analysts believe it could deliver a 17.73% return over the next year. Brokerage firm Nirmal Bang has set a target price of over Rs 2,000 for the stock.

HDFC Bank’s core business is valued at 2.5 times its September 2026E adjusted book value. After factoring in subsidiary value, the brokerage has derived a target price of Rs 2026 for the bank. They believe this target adequately reflects an 11.5% loan and 11.9% earnings CAGR from FY24-FY27E, resulting in a RoA/RoE of 1.9%/15% by FY27E.

Technical Research Analyst Jatin Gedia from Sharekhan by BNP Paribas remains bullish on the stock. He notes that HDFC Bank has broken out of a six-month consolidation period and targets potential gains between Rs 1980 to Rs 2000, with strong support at Rs 1700-1720.