Motilal Oswal sees up to 50% upside in this stock! Should you buy now?

According to a recent report by Motilal Oswal, Mumbai-headquartered HDFC Bank has exhibited a healthy revival in retail loan growth propelled by a pick-up in unsecured segments while the commercial banking segment has also witnessed strong traction.
 
"These have enabled a recovery in NII growth and will support margin growth – both of which have likely bottomed out in our view," the brokerage house added.
 
The stock rose 1.80 per cent to hit an intraday high of Rs 1,351 on BSE. Market cap of the firm rose to Rs 7,48,961.89 crore. The shares stand lower than 5 day, 20 day, 50 day, 100 day and 200 day moving averages.
 
The brokerage firm added that the bank has been expanding its presence in the Semi-urban and Rural (SURU) regions, which is enabling it to capitalize on the growth opportunities. It is steadily becoming the largest lender in MSME financing.
 
Motilal Oswal has a 'Buy' rating on the stock with a target price of Rs 2000 per share. So, if you compare it with the current market price, the stock has an upside potential of around 50 per cent.
 
The stock has undergone a significant correction and is trading at ~2SD below its 10- year average valuations, while the growth and earnings outlook remains robust.
 
"We expect the bank to deliver a healthy business growth fueled by a pick-up in retail (unsecured products) business and continued strength in commercial banking business. We estimate HDFCB to report 18 per cent PAT CAGR over FY22-24, with an RoA/ RoE of 2.0 per cent/17.5 per cent in FY24E, respectively," Motilal Oswal said.
 
The country's largest private sector lender reported an 18.1 per cent rise in its standalone net profit at Rs 10,342.20 crore for the third quarter ended December 2021.
 
The bank had registered a net profit of Rs 8,758.29 crore in the corresponding quarter of the previous fiscal year.
 
Total income on a standalone basis rose to Rs 40,651.60 crore in the October-December quarter of FY2021-22, as against Rs 37,522.92 crore in the same period of the previous financial year, HDFC Bank said in a regulatory filing.