HDFC Bank Rallies 2% on Strong Q4 Update, Defies Broader Market Downturn

On April 4, 2025, the shares of HDFC Bank surged 2%, even as the Indian stock market moved in the opposite direction. This bullish rally came post the bank announced upbeat business update for Q4 FY25.

Strong Q4 FY25 Performance

HDFC Bank reported robust growth in key areas during the quarter ending March 31, 2025. Gross advances reached ₹ 26.43 lakh crore, showing a year-on-year increase of 5.5% compared to ₹ 25.07 lakh crore in the previous year. The gross advances grew by 4% from ₹ 25.42 lakh crore at the end of December 2024. The bank's total deposits also saw a significant growth, surging to ₹ 27.14 lakh crore, a 14.1% year-on-year jump from ₹ 23.79 lakh crore in Q4 FY24. On a quarter-on-quarter basis, deposits increased by 5.9% from ₹ 25.64 lakh crore in Q3 FY25.

Strategic Focus Post-Merger

After merging with its parent HDFC Ltd, HDFC Bank has had its sights set on regaining its credit-deposit ratio to the pre-merger levels. The management had indicated that FY25 would be a consolidation year, with loan growth lagging the banking system. In FY26, management will target system-wide loan growth and a degree of outperformance in FY27 after realigning its balance sheet and deposit base. HDFC Bank had securitised loans worth ₹ 57,000 crore in the financial year FY25 including ₹ 10,700 crore in the March quarter alone. Average deposit base rose by 15.9% on-year and 3.1% on-quarter to ₹ 25.28 lakh crore. Current Account Savings Account (CASA) deposits also grew 5.7% y-o-y and 1.4% sequentially to ₹ 8.29 lakh crore. 

Market Reaction and Stock Performance

Exceptional updates boosts HDFC Bank share price by 2% to an intra-day high of ₹ 1,841.95, putting it among the top gainers on the Nifty 50. The stock hit a day's high of ₹ 1,830, edging closer to its 52-week high of ₹ 1,880 seen in December 2024. It has also grown considerably, this time by 28%, from its 52-week low of ₹ 1,430.15. The banking stock is up by 21% over the past 12 months, including a 5.5% increase in March and a 2% gain last February.

Broader Market Context

The rise in HDFC Bank's share price occurred despite a broader downturn in the Indian stock market, with the BSE Sensex down by 0.99% at noon on April 4. This indicates the strength of HDFC Bank's Q4 performance in influencing its stock price movement, even against prevailing market trends

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