Quick Note - HDFC Bank (HDFCB IN) (Buy) - FCNR (B) 2026 – potential blessing for HDFCB

Research evidence excerpt

Quick Note - HDFC Bank (HDFCB IN) (Buy) - FCNR (B) 2026 – potential blessing for HDFCB

Global Markets Research

HDFC Bank HDBK.NS HDFCB IN 14 June 2026

EQUITY: BANKS

RatingFCNR (B) 2026 – potential blessing for HDFCB Remains Buy

Target price INR 950 RemainsQuick Note

Closing price

12 June 2026 INR 772HDFCB – the balance sheet that needed this the most

The market concerns that have weighed on HDFCB are not independent problems. Deposit growth

lagging expectations, CD ratio above management's guidance, LCR the lowest among large private

peers, and a higher reliance on short-term wholesale funding. They are the same problems viewed Research Analysts

from different perspectives. The RBI's FCNR (B) scheme could address all these in a single window, India Banks

making HDFCB a potential standout beneficiary in our coverage. The bank could garner ~15% of Ankit Bihani - NFASL

overall FCNR flows, in our view – equivalent to 3% of its current deposit base. ankit.bihani@nomura.com

+91 22 403 74135

Among the large private banks, the ask on deposit growth was the highest for HDFCB. To bridge

Shreyas Pimple - NFASLthe gap between credit and deposit growth, the bank has been one of the most active participants in

shreyas.pimple@nomura.comthe CD market over the past 12 months (Fig.5) – a short-term fix that was adding to funding costs

+91 22 403 74029

and keeping NIM pressure elevated. The concern was that without a meaningful acceleration of

Shreya Shivani - NFASLdeposits, the bank would either have to keep paying up or slow loan growth.

shreya.shivani@nomura.com

FCNR could remove this dilemma. Pro-forma deposit growth could re-rate from ~15% to ~18% in +91 22 403 74804

FY27F (Fig.7) – met through the NRI channel, without a domestic rate war. Loan growth, which