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HDFC Bank
On the issue of liquidity, HDFC Bank does not foresee any major improvement in the
near future. It expects the banking system to remain net borrowers from the central
government in order to manage inflation on the one hand and growth on the other.
However, it expects the credit growth–deposit growth gap to narrow soon.
The bank feels there is sufficient room for everyone to expand, given the type of growth
the economy is expecting. It believes it can expand its low-cost deposits (CASA) without
hurting the share of other banks. According to it, banks that can leverage their CASA
franchise to expand their product portfolio would emerge as value creators in the long
term.
HDFC Bank does not foresee any significant reduction in its cost/income ratio in the near
term. However, it believes a 100-150bps improvement is possible. It has not witnessed
any slowdown in the demand for working capital loans. On the manufacturing capex
front, it believes that ongoing projects are progressing as per schedule, but there has
been a slowdown in the onset of new projects. Projects primarily dependent on
government policies and clearances are facing delays.
The bank does not expect any major shift in its retail loan portfolio despite increasing
competition; it plans to ramp up its distribution network at a steady pace for the next
couple of years.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
HDFC Bank
On the issue of liquidity, HDFC Bank does not foresee any major improvement in the
near future. It expects the banking system to remain net borrowers from the central
government in order to manage inflation on the one hand and growth on the other.
However, it expects the credit growth–deposit growth gap to narrow soon.
The bank feels there is sufficient room for everyone to expand, given the type of growth
the economy is expecting. It believes it can expand its low-cost deposits (CASA) without
hurting the share of other banks. According to it, banks that can leverage their CASA
franchise to expand their product portfolio would emerge as value creators in the long
term.
HDFC Bank does not foresee any significant reduction in its cost/income ratio in the near
term. However, it believes a 100-150bps improvement is possible. It has not witnessed
any slowdown in the demand for working capital loans. On the manufacturing capex
front, it believes that ongoing projects are progressing as per schedule, but there has
been a slowdown in the onset of new projects. Projects primarily dependent on
government policies and clearances are facing delays.
The bank does not expect any major shift in its retail loan portfolio despite increasing
competition; it plans to ramp up its distribution network at a steady pace for the next
couple of years.
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