HDFC Bank shares hit three-month high, up 21% from 52-week low; what should investors do?

HDFC Bank share price: Shares of HDFC Bank Ltd are trading at their three-month high, scaling the Rs 800 mark in the last session. It slipped to a 52 week low of Rs 668.90 on October 28 this year. Since then, the stock has gained 21%. In the current session, HDFC Bank stock rose nearly 2% to Rs 812. Market cap of HDFC Bank surged to Rs 12.44 lakh crore.

In terms of RSI, the stock is overbought on charts with the value at 74.4. A value above 70 signals a stock is oversold on charts.

The trend has been bullish for the banking stock, which trades above the 10 day, 20 day, 30 day, 50 day, 100 day, 150 day and 200 day simple moving averages.

JM Financial has a raised its target price to Rs 850 from Rs 800 for the lender.

Despite near-term growth constraints from a low LCR (113%) and elevated CD ratio (96%), the brokerage is positive on medium-term NIM recovery, driven by the run-off of high-cost borrowings and repricing of the floating rate loan book.

"With pristine asset quality and valuations becoming attractive following the stock correction, we are upgrading HDFC Bank to BUY from ADD and raising TP to INR 850 (from INR 800), valuing the core bank at 1.6x FY28E standalone BVPS and subsidiaries at INR 128/share. We expect ~15% loan and 14% EPS CAGR over FY26–29E," said JM Financial.

MOFSL has a price target of Rs 925 on the private sector lender.

The brokerage has raised its FY27/FY28 earnings estimates by 3.5% each and estimate HDFC Bank to deliver FY28E RoA/RoE of 1.74%/14.1%. "Reiterate BUY with a target price of Rs 925 (1.8x FY28E ABV + Rs 124 for subsidiary)," said the brokerage.