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HDFC Bank shares slip 2% despite CEO clarity; what could unlock a rerating?
5 min read | Updated on October 05, 2026, 11:49 IST
SUMMARY
Bagchi, who has been associated with ICICI Bank and its subsidiaries since 1992, will succeed Sashidhar Jagdishan, whose six-year stint in the corner office was marred by allegations of unethical conduct and questionable governance practices towards the end.
Stock list
In early trade, the scrip advanced as much as 1.8% to ₹734.20 apiece on the NSE. However, the stock later reversed all its gains.
After rising in early trade, HDFC Bank shares slipped into the red in late-morning deals on Monday, October 5. The stock is in focus as Anup Bagchi is set to become the next chief executive and managing director of the lender, after the RBI cleared his appointment to lead the country’s largest private sector bank on Thursday, October 1.
In early trade, the scrip advanced as much as 1.8% to ₹734.20 apiece on the NSE. However, the stock later reversed all its gains and fell as much as 2.16% to a low of ₹705.60.
While Bagchi’s appointment removes a key overhang for the stock, analysts have flagged the metrics that will be crucial for a potential rerating.
Bagchi's appointment: Key facts
Bagchi, who has been associated with rival ICICI Bank and its subsidiaries since 1992, will succeed Sashidhar Jagdishan, whose six-year stint in the corner office was marred by allegations of unethical conduct and questionable governance practices towards the end.
He will take over as the MD and CEO from October 27, and the appointment is for three years, as per an exchange disclosure by the lender.
The 56-year-old Bagchi, an alumnus of IIT-Kanpur and IIM-Bangalore, has been serving as managing director and chief executive of ICICI Prudential Life Insurance since 2023 and served as executive director of ICICI Bank for six years. Before that, he was overseeing both retail and wholesale banking.
Besides this, the bank has also released its business updates for the Q2 FY27 (September quarter).
- The bank’s average advances under management (advances grossing up for inter-bank participation certificates, bills rediscounted and securitisation / assignment) were ₹31,872 billion for the September 2026 quarter, a growth of around 14.0% over ₹ 27,946 billion for the corresponding September 2025 period.
Its period end advances under management were approximately ₹33,075 billion as of September 30, 2026, a growth of around 15.3% over ₹28,688 billion as of September 30, 2025.
The bank’s period end gross advances aggregated to approximately ₹ 32,195 billion as of September 30, 2026, a growth of around 16.3% over ₹27,692 billion as of September 30, 2025.
- The bank’s average deposits were ₹31,665 billion for the September 2026 quarter, a growth of around 16.8% over ₹27,105 billion for the corresponding September 2025 period.
HDFC Bank's average CASA deposits were ₹9,712 billion for the September 2026 quarter, a growth of around 10.7% over ₹8,770 billion for the corresponding September 2025 period.
The lenders's average time deposits were ₹21,952 billion for the September 2026 quarter, a growth of around 19.7% over ₹18,335 billion for the corresponding September 2025 period.
The bank’s period end deposits were approximately ₹33,275 billion as of September 30, 2026, a growth of around 18.8% over ₹28,018 billion as of September 30, 2025.
The bank’s period end CASA deposits were approximately ₹ 10,520 billion as of September 30, 2026, a growth of around 10.8% over ₹9,492 billion as of September 30, 2025.
The bank’s period end time deposits were approximately ₹ 22,755 billion as of September 30, 2026, a growth of around 22.8% over ₹18,526 billion as of September 30, 2025.
FCNR(B) deposits and overseas lending
Under the RBI’s FCNR(B) deposit swap facility introduced on June 8, 2026, HDFC Bank mobilised foreign currency deposits worth $11.5 billion (₹1,103.4 billion) through August 31. Its overseas branches extended $5.7 billion (₹547.7 billion) in loans against these deposits, while standby letters of credit issued to other banks for such loans amounted to $3.1 billion (₹293.4 billion).
Separately, the bank issued $2.5 billion (₹239.6 billion) of USD-denominated senior unsecured bonds during June–August 2026.
What leading analysts have said
CITI
CITI said FCNR deposits are fuelling the headline growth, while core advances growth continues to trail the system average.
Excluding FCNR, core deposits and advances growth stood at 15.3% and 14.5%, respectively. Citi expects asset quality across segments to remain resilient and stable.
JPMorgan
JPMorgan said the RBI’s approval of Anup Bagchi as HDFC Bank’s MD & CEO is a positive inflection point, with the external CEO appointment potentially helping reduce the stock overhang.
The global investment firm said a strategic reset could further support the stock, while a revival in net interest income (NII) growth remains key for a rerating. The stock has de-rated 32% year-to-date.
Morgan Stanley
Analysts at Morgan Stanley said the RBI’s approval of Anup Bagchi as MD & CEO for a three-year term addresses the CEO succession issue, which had been an overhang on the stock.
It sees the announcement as reducing uncertainty around the bank. HDFC Bank has underperformed the Bankex by 19 percentage points year-to-date, Morgan Stanley said.
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