Margin Concerns Weigh on HDFC Bank Shares, Down 2.2%

HDFC_Bank_Stock_Analysis_-_Margin_Concerns_Weigh_on_HDFC_Bank,_Shares_Down_2.2_

◉ HDFC Bank's Quarterly Update

HDFC Bank, the largest constituent of the Nifty 50 index, has released its quarterly performance update, highlighting a notable divergence in deposit and loan growth. Specifically, the bank reported a 15.8% year-on-year increase in deposits, significantly outpacing the 3% year-on-year growth in loans.

◉ A Cloud of Uncertainty

Experts believe this gap could negatively impact the bank’s net interest margin, possibly reducing its net profit.

◉ Investors Take a Step Back

This news caused a stir in the market, leading to a 2.2% drop in the share price yesterday (Jan 06).

◉ Technical Observations

HDFCBANK - DAILY TECHNICAL ANALYSIS
  • The stock price has fallen below its trendline support and is currently trending downward.
  • A minor support is anticipated around ₹1,700.
  • If the stock price drops below this level, the next support is projected to be close to ₹1,600.

MONEY MANAGEMENT AND TRADING RULES

1)  It’s advisable not to enter/exit beyond the recommended range.
2)  Strictly follow the StopLoss as mentioned. Honour it.
3)  Use trailing StopLoss to retain profits.
4)  Diversify trading capital into our other technical recommendations.
5)  Risk only the money what you can afford to lose. Hedge accordingly.

ANALYST SUMMARY

The research analysis is prepared by Arijit Banerjee, CMT, CFTe. He is a veteran trader and an active investor having in-depth knowledge in financial market research, advanced technical analysis, market cycle, algorithmic trading and portfolio management. Arijit is a Chartered Market Technician (CMT) accredited by CMT Association USA, the leading global authority of Technical Analysis and has been honoured by Certified Financial Technician (CFTe) from the International Federation of Technical Analysts, USA. SEBI, the regulatory body of Indian financial market also recognizes him as a Research Analyst (INH300006582).

Disclosure

The views expressed herein are based solely on information available publicly/internal data/other sources believed to be reliable, but is not necessarily all-inclusive and is not guaranteed as to accuracy. The recommendations provided herein is solely for informational purposes and are not intended to be and must not be taken alone as the basis for an investment/trading decision. Trading and investing are subject to market risk and the securities discussed and opinions expressed herein may not be suitable for all investors. To read the full disclosure, please click here.

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