On Friday, HDFC Bank shares experienced a significant drop following the private lender’s report of a quarter-on-quarter (QoQ) decline in loans disbursed during the first quarter of the 2024-25 financial year
The stock fell 4.55% to close at ₹1,648.10, marking an 8.03% decrease from its 52-week high of ₹1,791.90, which was achieved just a few sessions earlier on July 3.
In the April-June quarter (Q1 FY25), gross advances decreased by 0.8% sequentially to ₹24.87 lakh crore, primarily due to a 5% QoQ reduction in corporate loans. Deposits for the bank stood at ₹23.79 lakh crore in the June quarter, remaining nearly unchanged from the previous quarter. Notably, low-cost current and savings account deposits fell by 5% sequentially to ₹8.64 lakh crore.
The loan-to-deposit ratio (LDR), an indicator of whether a lender has sufficient deposits to support loan growth, remained flat at 105% compared to the prior quarter. These figures are provisional, with the bank scheduled to announce its financial results on July 20.
Mayuresh Joshi, Head of Equity Research at William O’Neil India, told Business Today TV that despite the recent downturn, the bank’s figures are expected to improve gradually. “The stock has moved significantly in the last few months. So, investors can look at it at lower levels. The stock will go through a phase of consolidation until numbers show improvement, and we expect some relief by the second half of this financial year,” Joshi stated.
Technical Analysis and Recommendations
Several analysts noted that the stock has support at ₹1,590 and resistance at ₹1,700. One analyst suggested booking profit in the ₹1,630-1,660 range.
Shiju Koothupalakkal, Technical Research Analyst at Prabhudas Lilladher, stated, “The stock has near-term support at the ₹1,590 level. It is expected to recover once stability is confirmed near this zone and thereafter regain strength to continue its upward move. A decisive breach below ₹1,530 would weaken the overall trend.”
Jigar S Patel, Senior Manager and Technical Research Analyst at Anand Rathi Shares and Stock Brokers, added, “HDFC Bank’s stock has encountered strong resistance around the ₹1,700 level. We advise traders to avoid initiating fresh positions at the current market price.” Patel also recommended that those holding the stock should consider booking profits in the ₹1,630-1,660 range.
Disclaimer
The Courtroom provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.
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