HDFC share price rose in trade today after Morgan Stanley raised the target price for the housing finance lender and maintained its overweight call.
HDFC share price gained up to 2.12% to Rs 2,352.8 compared to the previous close of Rs 2,303.85 on BSE. The large cap stock erased some gains and closed 1.41% higher at Rs 2336.30 on BSE. HDFC stock has gained 6.21% in last five days. The stock is 0.89% away from its 52-week high of Rs 2,357 hit on July 18, 2019.
The stock has gained 22.86% during last one year and 18.59% since the beginning of this year.
Morgan Stanley said return on equity (RoE) and earnings per share (EPS) growth is poised to stage a multi-year recovery, supported by structurally stronger positioning among non-bank lenders. The research firm forecasted FY20-25 EPS compounded annual growth rate of 22 percent for HDFC's core lending business and expects core RoE to improve to 15.5 percent in FY22 and 18.5 percent in FY25 from 13 percent in FY20.
HDFC's valuations look attractive with pick-up in loan growth seen over the next 12 months, Morgan Stanley said. The research firm raised its target price for HDFC stock to Rs 2,900 from the previous Rs 2,600.
By Aseem Thapliyal