HDFC Bank Management Guidance Tracker

Management expects full-year loan growth in the 17-18% range, consistent with historical doubling every 4-5 years.

Management indicated that the capacity built should enable retail deposit accretion of around INR 1 trillion per quarter, though Q1 was seasonally lower.

The bank plans to grow the construction finance portfolio, which will support top-line and margin recovery.

Management expects deposit growth to exceed loan growth by 300-400 basis points to reduce the LDR over time.

Management outlined a three-year plan to normalize the loan-to-deposit ratio, with credit growth slower than system in FY25, matching system in FY26, and exceeding system in FY27.

Management reiterated confidence in sustaining ROA between 1.9% and 2.1% on a merged basis.

Management reiterated its ability to maintain return on assets in the 1.9%-2.1% range, consistent with historical performance.

Margins are expected to improve as the bank substitutes high-cost debt with deposits and shifts loan mix towards retail.

The bank aims to reduce cost-to-income from ~40% to mid-30% over the medium term through digital efficiencies and margin improvement.

Management expects net interest margins to stay within the current tight range, with potential improvement once LCR normalizes and regulatory clarity emerges.

Revised target from 1,500 to ~1,000 branches for FY24, with 570 branches in pipeline.

Management will start reporting penetration of savings accounts, credit cards, and consumer durable loans among new mortgage customers.

The bank aims to reduce its loan-to-deposit ratio from current ~110% to the high-80s over the next 2-3 years, faster than previously guided 4-5 years.