HDFC Bank shares witness strong buying, rise 7% in 1 month. Can new CEO, improving fundamentals drive next leg of rally?
HDFC Bank shares have gained 10.21% over the past week and 7.09% over the past month, signalling a pickup in buying interest. The stock has risen 8.89% over the past two weeks, but remains down 23.80% year-to-date and 23.36% over the past year, indicating that the recent recovery has yet to reverse its broader underperformance.
Investors are now assessing whether the rally can sustain, with the new CEO’s strategy and improving fundamentals emerging as key triggers.
The focus remains on loan and deposit growth, net interest margins, asset quality and the normalisation of the credit-deposit ratio following the HDFC merger. Can the leadership transition and a recovery in operating performance support a sustained rerating of HDFC Bank shares? Here is what analysts and technical experts expect.
Sunny Agrawal, Head of Fundamental Research at SBI Securities, said that with the uncertainty surrounding the bank's top-level management now addressed, the strategic roadmap of its new Managing Director and CEO will be a key monitorable.
He noted that HDFC Bank will also need to appoint a new Deputy Managing Director (DMD) and Head of Credit following Mr Bharucha's resignation. Alongside improving business metrics and realising merger-related synergies, the new leadership will have to manage senior-level attrition and build a strong management team.
Agrawal expects credit growth to remain healthy in the coming quarter, supported by a sustained recovery in the retail segment, which could further aid margins. He added that the gradual winding down of erstwhile HDFC borrowings should help reduce the bank's cost of borrowings (CoB).
Shitij Gandhi, AVP – Equity Technical Research at SMC Global Securities, said HDFC Bank is showing signs of a potential bullish reversal on the technical charts after recovering sharply from the ₹680–685 support zone.
He noted that the stock appears to be forming a broad rectangle pattern, with prices oscillating between ₹680 and ₹755, indicating a consolidation phase before a possible directional move. The recent rebound has strengthened the near-term technical structure, with the stock reclaiming its short-term moving averages and approaching the upper boundary of the range.
Gandhi identified ₹755–760 as the immediate resistance zone. A decisive breakout above this level could trigger fresh buying momentum, taking the stock towards ₹790, followed by ₹810 and ₹825.
On the downside, immediate support is placed at ₹740–741, followed by ₹710–715. He believes the overall technical outlook is cautiously bullish, with a sustained breakout above ₹760 likely to strengthen the positive momentum.
Sachin Gupta, VP – Technical Research at Choice Broking, said HDFC Bank has witnessed a positive turnaround after breaking above its falling trendline and extending its upward move with strong volume support.
He noted that the stock has also broken out of a sideways trading range following a gap-up opening of around 1.8%, indicating renewed buying interest. Additionally, it has moved above the upper Bollinger Band on the daily chart, reflecting strong price momentum. The daily Relative Strength Index (RSI) is around 66, suggesting that bullish momentum remains intact. The weekly RSI has also formed a bullish divergence, further supporting the improving technical structure.
Gupta identified the ₹717–720 zone as an important support area, backed by the 50-day Exponential Moving Average (EMA) and the falling trendline breakout level. He said this zone will be crucial in sustaining the current upward momentum.
As long as HDFC Bank shares hold above this support range, the overall technical outlook is likely to remain positive. On the upside, the stock could move towards ₹782–800, where the 200-day EMA is positioned. Traders should monitor whether the stock sustains its strength above the breakout zone, as this will be key to the continuation of the uptrend.
Gaurav Arora, Head of Research at SAHI, said HDFC Bank shares have spent much of the past year under pressure, declining around 25% from their November 2025 peak of nearly ₹1,020. Since August, the stock has been forming a base in the ₹680–740 range.
He noted that the stock moved above the upper end of this range during the current week and reclaimed its short-term exponential moving averages (EMAs), improving its near-term technical structure.
According to Arora, the next major resistance is placed at ₹780–800, where the 200-day moving average is positioned and where the stock had broken down in July. A sustained move above ₹800 would signal that the prolonged correction may be over. Until then, the current upmove appears to be a recovery within the broader trading range.
On the fundamental front, Arora said HDFC Bank's Q2 FY27 headline numbers do not fully reflect the improvement in its underlying performance. While reported profit growth was below 5%, this was largely due to lower treasury gains. Excluding these gains, profit growth was closer to 12–13%, he said.
The bank's asset quality also continued to improve, with gross non-performing assets (GNPA) at around 1.10%.
However, margin pressures remain a key concern. Arora noted that deposits are growing faster than loans as the bank continues to reduce its post-merger credit-deposit ratio. This adjustment has involved reliance on relatively costlier term deposits, while the CASA ratio has declined to around 31–32%.
He added that HDFC Bank is trading at less than 2 times its consolidated book value, suggesting that much of the concerns may already be priced in. However, a meaningful valuation re-rating is likely to require margin stabilisation. The new CEO's initial commentary and strategic priorities will therefore be important triggers for investors to watch.
Dhanya Nagasundaram works as a Content Producer at LiveMint, specializing in news related to financial markets, stocks, and business. With over eight years of experience in journalism and content creation, she has honed her skills in data-driven reporting and market analysis. Her focus is on monitoring stock trends, initial public offerings (IPOs), corporate news, policy shifts, and larger economic trends that affect investors and market players. <br><br> At LiveMint, Dhanya consistently writes and produces articles that make complex financial topics accessible to readers. She keeps a close eye on equity markets, commodities, and macroeconomic indicators, assisting audiences in comprehending how global and domestic events influence investment perspectives. Her stories frequently underscore emerging trends within sectors, the IPO market, company earnings results, and market strategies pertinent to both retail and institutional investors. <br><br> Before her tenure at LiveMint, Dhanya accumulated a wealth of professional experience at various companies, including MintGenie, Informist, Cogenics, Chary Publications, KPMG, and the Royal Bank of Scotland. These positions allowed her to establish a solid foundation in financial research, reporting, and content creation. <br><br> Throughout her career, she has explored numerous subjects such as trading strategies, commodities, IPOs, wealth generation, corporate profits, and macroeconomic indicators. Her background in both financial journalism and corporate settings has given her the ability to tackle stories with analytical rigor while ensuring clarity for her audience. Through her contributions, Dhanya strives to deliver insightful, trustworthy, and investor-centric financial content.
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