HDFC Bank shares: During the January selloff, these 5 MF houses purchased equities valued at Rs 11,400 crore.
HDFC Bank shares: Data compiled by PRIME Database indicates that ICICI Prudential Mutual Fund’s holding in the private bank surged to Rs 19,990.25 crore in January from Rs 19,074.69 crore in December.
In January, five leading mutual fund houses acquired HDFC Bank shares worth Rs 11,400 crore, a month that saw the private lender’s stock plummet by 14.44% post-disappointing December quarter results. After experiencing an almost 10% surge in December, HDFC Bank faced significant challenges in January. Analysts expressed concerns over the need for the bank’s deposit growth to surpass loan growth notably to decrease wholesale borrowings in its funding mix. However, they remained skeptical about the ease of changing this trend due to tight system liquidity and challenges in deposit mobilization.
HDFC Bank
According to data compiled by the PRIME Database, a total of 27 mutual fund houses were net buyers of HDFC Bank shares in January. Despite this, the most-valued banking stock on Dalal Street witnessed a further 3% decline in February thus far.
According to data compiled by PRIME Database, ICICI Prudential Mutual Fund’s stake in the private bank increased to Rs 19,990.25 crore in January from Rs 19,074.69 crore in December. This signifies a rise in holding value by Rs 915.56 crore. Furthermore, the PRIME Database indicates that ICICI Pru MF was a net purchaser of HDFC Bank stocks worth Rs 3,933.91 crore during the same period.
HDFC Mutual Fund increased its stake in HDFC Bank from 14,29,39,836 shares to 16,19,51,696 shares. However, despite this increase in shares held, the holding value of HDFC Mutual Fund in the bank decreased by Rs 745.75 crore, falling to Rs 23,686.25 crore from Rs 24,431.99 crore. Despite the decrease in holding value, HDFC Mutual Fund was a net buyer of HDFC Bank stocks, purchasing shares worth Rs 2,981.62 crore during the month.
Likewise, Kotak Mahindra Mutual Fund emerged as a net buyer of HDFC Bank stock, acquiring stocks worth Rs 2,625.32 crore. This resulted in a rise in its holding value by Rs 1,057.28 crore, climbing to Rs 10,694.85 crore from Rs 9,637.57 crore. Additionally, PPFAS Mutual Fund and Nippon India Mutual Fund also increased their stakes in HDFC Bank.
HDFC Bank shares
In January, PPFAS Mutual Fund purchased HDFC Bank stocks worth Rs 954.99 crore, while Nippon India Mutual Fund added HDFC Bank stocks worth Rs 893.09 crore to its portfolio. Collectively, these five mutual funds acquired HDFC Bank shares amounting to Rs 11,388.92 crore.
Domestic fund companies that were net sellers of HDFC Bank stocks in January were SBI Mutual Fund (down Rs 517 crore), Motilal Oswal MF (down Rs 336 crore), Axis Mutual Fund (down Rs 335 crore), and Franklin Templeton Mutual Fund (down Rs 170 crore).
According to a note from Morgan Stanley, several risks to the downside include a significant deceleration in economic growth impacting loan growth and leading to increased non-performing loans. Additionally, there’s high competitive pressure on loan and deposit pricing. Moreover, there’s a potential risk of a deeper holding company discount if the RBI mandates the NOFHC (Non-Operative Financial Holding Company) framework.
Upside risks for HDFC Bank included stronger-than-expected loan growth and margin advancement, faster-than-expected improvement in operating leverage, and lower-than-expected asset quality stress.
