India’s second largest private sector bank HDFC Bank, reported its first quarter result for 2011 (April-June), its net profit rose by more than 33% to Rs.1,085 crore as compared to the same period last year. This result was better than expected, so the market participants has become positive on the growth of this private sector bank. However, the CASA (Current Account Savings Account) ratio dipped to 49.1% from 51% in March quarter, this was a marginal decline. During this first quarter, 20% year-on-year (YoY basis) growth was reported to Rs.1.75 lakh crore while deposits grew Rs.2.11 lakh crore with growth rate of 15.36%.
Net interest income (NII) in the Q1 (April-June period) surged 18.6% year-on-year (YoY basis) to Rs.2,848 crore from Rs.2,401 crore for same period in previous year. Net interest margin (NIM) had remained unchanged at 4.20% suggesting that the bank was successful in maintaining its margin in the term of the higher cost of borrowings, as there was interest rates hike in this financial year. Also HDFC bank has raised Rs.3,650 crore of tier II capital by issuing tier II bonds, in this quarter.
How about HDFCBANK stock: Looking at the charts we see that HDFC Bank stock is trading at life time high. This indicates that there is much up side left in this counter and we are sure that there is strong bullish trend building after the results has been announced. So looking this as a solid opportunity we will be looking for buys only as long as HDFCBANK trades above the 440 level. So investors can also accumulate it from current level for targets as 536 and then 588 in short term. Also it is advised to place the stop loss below the 440 level. Technical tools suggests us that we are on the right side of the trade and validate our targets and entry points as well.