Zacks Investment Research upgraded shares of HDFC Bank Ltd. – ADS (HDB) from UNDERPERFORM to OUTPERFORM on December 23, 2013, with a target price of $37.00.
We are upgrading our long-term recommendation on HDFC Bank to Outperform based on strong fiscal second-quarter (ended Sep 30) 2014 earnings. Results benefited from a rise in revenues, partially offset by higher operating expenses. Further, deposit and loan balances improved, while credit quality was a mixed bag. Though we expect a further rise in expenses, negative impact from new capital regulations and deterioration in asset quality, continued synergies from the company's exposure to the fast-growing Indian retail credit sector will likely offset these negatives. Additionally, consistent branch expansion will lead to further growth in deposits and loans.
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