HDB Financial shares traded in a volatile manner in morning trade on Thursday, 16 July, a day after the company reported its June quarter results.
HDB Financial share price jumped 4.6% in early deals to hit the day’s high of ₹786.20 on the BSE but quickly erased gains, dropping 0.50% to an intraday low of ₹747.40.
Shares of the company swung between gains and losses even as the company, on Wednesday, 15 July, reported its highest ever quarterly profit after tax (PAT) of ₹785 crore, up 38.3% year-on-year (YoY).
HDB Financial Services Q1FY27 results key takeaways
As per the company’s exchange filing, its net interest income (NII) jumped nearly 20% YoY to ₹2,509 crore for the June quarter, while net interest margin (NIM) increased to 8.4% from 7.7% YoY.
Net total income saw a healthy 16.8% YoY growth to come at ₹ 3,185 crore.
Pre-provisioning operating profit at ₹1,752 crore clocked a 25% YoY increase.
Loan losses and provisions for the quarter ended 30 June 2026 stood at ₹697 crore, up 4.1% from ₹670 crore for the same quarter in 2025.
HDB Financial Services’ asset under management (AUM), as of 30 June 2026, stood at ₹1,22,048 crore, rising 11.3% from ₹1,09,690 crore by the end of the corresponding quarter of the previous year.
Gross loan book increased by 11.4% YoY to ₹1,21,846 crore as on June 30.
Gross Stage 3 loans declined to 2.34% against 2.56% YoY, while net Stage 3 loans stood at 1.04% against 1.11% YoY.
Provision coverage stood at 55.73% on stage 3 assets against 56.70% YoY.
Is HDB Financial a stock to buy?
Experts and top brokerages have mixed views on the stock after the Company’s Q1 results, with most of them maintaining their earlier estimates.
Brokerage firm ICICI Securities has maintained a buy call on the stock with a target price of ₹900, citing HDB Financial Services, with steady RoE expansion to nearly 15% in Q1FY27 versus 13.2% in Q1FY26, sustained its improving earnings trajectory, despite sector-level headwinds, including elevated interest rates and geopolitical challenges.
ICICI Securities highlighted that the company’s strong operating performance was mainly driven by robust 20% YoY NII growth, more than 250 bps YoY reduction in cost -income ratio, while credit cost remained stable at 2.4%, even during a seasonally weak quarter.
“Leveraging its HDFC Bank parentage and deep-seated competitive moat, HDB Financial Services is likely to sustain 15%+ RoE and improve credit growth to 17–18% CAGR over FY26–28E. We maintain a buy and our target price of ₹900, valuing the stock at 3 times September 2027E BVPS,” said ICICI Securities.
On the other hand, JM Financial reiterated its add view, raising the target price to ₹820 from ₹710 earlier.
JM Financial highlighted that HDB Financial continues to be on its ‘recovery trajectory’ with an in-line PAT as higher-than-expected opex, offset by lower-than-expected provisions.
“HDB is in the midst of a cyclical recovery supported by improving asset quality across most segments and stronger disbursement momentum. However, recovery in asset finance and enterprise lending disbursements is a key aspect to monitor,” said JM Financial.
“We largely maintain FY27–28E EPS and value the stock at 2.5 times FY28E BVPS (earlier 2.1 times) due to rollover and multiple increase, factoring in a nearly 16% AUM CAGR and nearly 16% RoE over FY27–28E,” said JM Financial.
Brokerage firm Emkay Global Financial Services has maintained a “reduce” call on the stock, but raised the stock’s June 2027 target price to ₹725 from ₹675 earlier.
Emkay said HDB reported a good quarter in terms of disbursement, asset quality, and profitability, while AUM growth remained soft. Besides, it pointed out that the company’s management expects operating efficiency to improve as it continues to invest in AI tech and leverage its digital assets.
“To reflect the Q1 developments and management commentary, we tweak our FY27-29 estimates, leading to a nearly 3-7% increase in earnings,” said Emkay.
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Disclaimer: This article is for educational purposes only and does not constitute investment advice. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
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