At the end of Q3FY24, LIC held 340,921,284 shares, representing a 5.19% stake in the Bank. The estimated value of this stake, based on the Thursday closing price of the stock, stands at ₹48,836 crore. With this approval, LIC can now buy an additional 4.8% stake.
Financial metrics that stood out in the industry gave HDFC Bank a premium valuation that was competitors envy. Now that it resembles its peers, the valuation may also remain aligned.
The lender's quarterly earnings last week prompted a sharp 15% decline in the stock, even as its profit beat expectations, as analysts raised concerns about lending margins and sluggish deposit growth in its second quarterly report since merging with Housing Development Finance Co.
While earnings by the country s biggest private sector lender remained a concern, global brokerage CLSA has reiterated its ‘buy’ rating on the stock with a target of ₹2,025 per share, implying an upside of almost 38 percent.