HDFC Bank Share Price Target at Rs 981: Deven Choksey Share Research

K S Srinivasan 2 November 2026
HDFC Bank Share Price Target at Rs 981: Deven Choksey Share Research

Deven Choksey Research has maintained its BUY rating on HDFC Bank with a target price of Rs 981, implying about 43% upside from Rs 688. The brokerage likens new MD and CEO Anup Bagchi's arrival to a Formula 1 pit stop: growth may slow for two to four quarters while he repairs liquidity, rebuilds low-cost deposits and settles governance concerns. Liquidity coverage sits at 113%, the loan-to-deposit ratio at 96% and CASA at 31.6%. After a roughly 30% fall this year, the stock trades near 1.3x FY28 core book. The brokerage says the market has priced the pit stop, not the recovery, and would add on dips.

Four lights on, one to go: the reset has started, the recovery has not

BUY MaintainedLeadership Change NotePrivate Banking

HDFC Bank's pit stop: Deven Choksey sees a slower lap under Anup Bagchi, then a Rs 981 finish

The brokerage argues that the market has priced in the time lost in the pit lane but not the faster car that could come out of it.

The timing tower: levels for investors

Live timing · HDFC Bank · Oct. 27, 2026

P1 Target priceRs 981
Gap to target+43%
Current priceRs 688
Fastest lap (52-wk high)Rs 1,017
Slowest lap (52-wk low)Rs 682
Market capRs 10,57,956 cr

Deven Choksey Research keeps a BUY on HDFC Bank with a Rs 981 target, valuing the standalone bank at 2.0x FY28E adjusted book value of Rs 439 and adding Rs 102 per share for subsidiaries.

At Rs 688, the stock sits barely Rs 6 above its 52-week low after falling about 30% this year. It trades at 1.3x FY28E core book and 11.9x FY28E earnings of Rs 58, multiples the brokerage calls near trough.

The brokerage's stance is to add on dips during the reset rather than wait for proof.

Telemetry: what the new driver inherits

The franchise is intact, the brokerage says, but four readings on the dashboard need attention before the bank can push again.

Liquidity coverage

113%

Near the bottom of the 110% to 120% operating band.

Loan-to-deposit

96%

Almost every rupee of deposits is lent out.

CASA ratio

31.6%

Low-cost deposit base has slipped and needs rebuilding.

Net interest margin

3.32%

Bottomed; turning with the October rate hike.

Two regulatory headwinds sit on top: draft insurance commission rules that threaten fee income, and the expected credit loss (ECL) transition from April 2027. Separately, the governance overhang is real. The chairman resigned in March, citing practices "not in congruence" with his values, as widely reported; the deputy MD leaves on Dec. 31; and an internal review of alleged information leaks, first reported by Bloomberg, is ongoing.

Driver profile: the first outsider in the cockpit

AB

Anup Bagchi

MD and CEO · 34 years at ICICI

Previous team Role Result on the board
ICICI Securities CEO Built icicidirect.com
ICICI Bank, 2017-23 Executive director, retail then wholesale Took the mortgage book past Rs 2 lakh crore
ICICI Prudential Life, from 2023 Chief executive FY25 APE +15%, PAT about +40%; FY26 VNB margin 24.7% on flat APE

He is HDFC Bank's first chief from outside since Aditya Puri built the franchise. The brokerage reads his mandate as importing ICICI's operating discipline: risk-adjusted growth, a sharper focus on core operating profit and a "one-team" culture, not a rebuild from scratch.

Pit-wall radio from the Q2FY27 call

Bagchi spoke only three times on the call, but each message pointed the same way. His outgoing predecessor, Sashidhar Jagdishan, effectively handed over the race plan.

RADIO · BAGCHI

Will first "engage with the regulators, customers, shareholders," naming the regulator first. The agenda: "growth, margins, quality, and productivity built on disciplined capital deployment," with "more room" on productivity, which hints at flat headcount.

RADIO · JAGDISHAN

"Minimise the intake of corporate liabilities," keep making "structural adjustments" on the balance sheet, and follow an "LCR flight path" up from 113%.

STRATEGIST

Deven Choksey's read: liabilities and liquidity come first, a tilt toward retail and MSME loans second. Growth is the variable that gives way.

Race history: credibility before speed

Past handovers at Indian private banks followed a familiar order: recognise the problems, repair the balance sheet, then chase growth.

Sector 1 · ICICI Bank, 2018

Sandeep Bakhshi reset around core operating profit, risk-calibrated growth and upfront provisioning, setting up a multi-year re-rating. Bagchi was on that team.

Sector 2 · Axis Bank, 2019

Amitabh Chaudhry's early quarters brought greater stress recognition and a rebuilt management bench before profits recovered.

Sector 3 · HDFC Bank 2020, Kotak 2024

Within months of each handover, the RBI curbed digital business, a reminder that the regulator can set the pace.

The pit-stop playbook: five changes expected

1

Liabilities first

Loan sell-downs or securitisation, slower mortgages, sharper core deposit pricing.

2

Margin over growth

Loan mix shifts toward retail and MSME.

3

Clean-up option

Early ECL or contingent provisions in Q4FY27.

4

New crew

A deputy MD successor and selective external hires.

5

Better disclosure

New KPIs such as core operating profit, possibly explicit RoA targets.

Lap times: the earnings path

Rs crore FY26 FY27E FY28E
Net interest income 1,28,700 1,41,600 1,60,800
Profit before tax 95,200 1,05,600 1,18,800
Net profit 74,700 79,700 89,500
EPS (Rs) 48.5 51.7 58.0
P/E at Rs 688 (TopNews calc.) 14.2x 13.3x 11.9x

Profit growth of roughly 7% in FY27 and 12% in FY28 is modest by the bank's own history. Ownership has also changed hands: foreign investors cut their stake from 44.05% in March to 39.39% in September, while domestic institutions raised theirs from 40.14% to 43.44%.

Race strategy: three ways the stint can end

Bear · safety car

~Rs 620 (-10%)

One-off provision, softer guidance, FY28E EPS 8% lower; 1.2x core book.

Base · planned stop

Rs 981 (+43%)

Current estimates; 2.0x core book.

Bull · undercut

~Rs 1,120 (+63%)

Credible LCR and deposit plan, RoA near 1.9%; 2.3x core book.

Two sensitivities show where the value lies. Every 0.1x move in the core multiple is worth about Rs 44 per share, and every 10 basis points of RoA adds about Rs 5,200 crore to FY28E profit, roughly 6% of EPS. Even a Rs 5,000 crore clean-up, the brokerage says, is small against book value. The skew it describes: about 10% downside against 63% upside.

STANDALONE BANK

2.0x × Rs 439 = Rs 878

+ SUBSIDIARIES

Rs 102

= TARGET

Rs 981

Next 90 days on the race calendar

Late November

Bagchi's strategy presentation to analysts.

Dec. 31

Deputy MD exits; the successor's identity matters.

January

Q3FY27 results, the first under Bagchi.

Undated

Outcome of the internal leak review and final insurance commission rules.

Yellow flags

Timing: the brokerage itself calls the recovery date uncertain; a reset that runs past four quarters would test patience.

Regulation: final insurance commission rules and the ECL shift could dent fees and provisions, and history shows the RBI can step in early in a new tenure.

Governance: an adverse finding from the leak review would prolong the overhang. (TopNews summary of risks drawn from the report's commentary; the report prints no separate risk list.)

Editor's note

Reset not in the numbers: the report expects slower growth for two to four quarters and a possible clean-up provision, yet says it has "not modelled a reset" in its estimates, so the Rs 981 target rests on pre-reset forecasts. The bear case is the closer guide to a messy transition.

Target already cut: the text says "maintain BUY" without mentioning a target change, but its own history table shows the target lowered from Rs 1,022 (July 21) to Rs 981 on Oct. 21, at a then-price of Rs 712. This note is dated Oct. 27, at Rs 688.

Clean-up arithmetic: Rs 5,000 crore over 1,543 crore shares is about Rs 3.2 per share before tax; the report's "under Rs 3" holds only after tax.

Sources

Deven Choksey Research (DRChoksey FinServ), HDFC Bank company note "New captain, slower lap," Oct. 27, 2026, analyst Maahir Mani; company disclosures cited in the report. Rupee figures converted from the report's units to crore; P/E row calculated by TopNews.

Disclaimer: This TopNews Story summarises a third-party brokerage report for information only and is not investment advice. Investment in securities is subject to market risks; read all related documents carefully and consult a registered adviser before investing.

Levels at a glance: HDFC Bank | BUY (Deven Choksey Research) | CMP Rs 688 | Target Rs 981 | Upside ~43% | Bear/bull ~Rs 620 / ~Rs 1,120 | 52-wk Rs 682-1,017 | Basis 2.0x FY28E ABV + Rs 102 subsidiaries

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