Consistency in Valuations Over Two Decades - Chart Of The Day 13 August 2018 - Equitymaster

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Consistency in Valuations Over Two Decades
Aug 13, 2018

HDFC Bank has enjoyed the distinction of being the bank with the most premium valuation for nearly two decades. For over 60 quarters, the bank has declared results which showed loan book growing over 18% YoY, net interest margins between 3.8% and 4.2% and net NPAs below 1%.

Irrespective of the rate of GDP growth, inflation and interest rates, the bank never bothered to bring big variations in operating performance. It happily let go of market share in risky assets and never appeased big corporate borrowers. The consistency in the valuations of the bank is something investors will have to be watchful about in coming years.

Data Source: HDFC Bank Annual Reports

This Chart Of The Day was published in The 5 Minute WrapUp - HDFC Bank Joins the List of 12 'Headless' Indian Banks. What Next?

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