Sell HDFC - Target Price Rs.690 - Kotak

Operating performance in line, high spread in retail business concerning. HDFC reported 19% yoy earnings growth, 2% below estimates. Loan growth was steady at 21% yoy even as NIM was somewhat below expectations. HDFC's segmental spreads indicate that the retail business earns spreads of 1.96% and drives 55% of its NII.

However, competition remains a concern in light of high yields (11-11.75%) in this business. Retain SELL with price target of Rs690.

Source : Equity Bulls

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