Tough fights between HDFC Bank and Goldman Sachs, both of them remained very low in market capital

HDFC Bank: The difference between the market cap of private sector bank HDFC and American Investment Bank Goldman Sachs in India is steadily decreasing. Where the market capital of HDFC Bank Limited has reached Rs 14.69 lakh crore ($ 17628 million). At the same time, the market capital of Goldman Sachs is Rs 14.93 lakh crore ($ 17916 million).

Amazing boom in bank shares

HDFC Bank’s market cap has jumped from its 52-week low of Rs 1,426.80 in April 2024 to almost equal and now its share price is close to Rs 2000. According to a report by IIFL Finance Limited, HDFC Bank shares have increased amazing, which is about 34 percent above its 52 -week low, which has a strong quarter result, strategic balance sheet management and positive market sentiment.

These are also due to boom in shares

According to another report by Nuwama Wealth and Investment Limited, another reason for the bank’s stock accelerated with Housing Development Finance Corporation (HDFC Limited) after merger in 2023, the bank focused on reducing the deployment related challenges. This also led to a bounce in the bank shares. The bank’s loan portfolio has also increased considerably due to this merger. However, compared to this, the deposit base is very low, due to which in March 2024, the loan-to-deploy ratio (LDR) remained 104 percent. After this, the bank again focused on raising deposits, which has reduced the LDR to 96.5 percent by March 2025.

LDR level will be less

The bank’s CFO Srinivasan Vaidyanathan has said that the management of the bank hopes that by FY 27, LDR Housing Development Finance Corporation will return to 85-90 % of the first level of merger from Finance Corporation.

According to Nuwama’s report, the bank has taken good advantage of improvement in systematic liquidity and cut in repo rate. This will help to keep the net interest margin stable, which is expected to reach 3.5-3.6 percent by FY 27 as high-cost borrowings are ending and the loan mix is ​​shifting to high yield retail assets. Nuwama has estimated the compound rate (CAGR) of 15 percent of the bank’s deposit growth between financial year 25 and FY 27.

On the other hand, unlike HDFC Bank, Goldman Sachs is traditionally not dependent on deposits or loans. Due to this, direct comparison cannot be made between the two. Nevertheless, the less difference between the market capital of both shows that HDFC Bank has the ability to give a tough competition to many big financial institutions in the world. Apart from this, in addition, Goldman Sachs has recently given a ‘BUY’ rating to HDFC Bank shares.

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