HDFC Bank stock crash: A look at its five biggest falls since 2020

HDFC Bank shares saw a sharp decline today after the resignation of its part-time chairman and independent director, Atanu Chakraborty, with immediate effect. Keki Mistry, the former CEO of HDFC Ltd was appointed as the interim part-time chairman, with approval from the Reserve Bank of India.

HDFC Bank shares opened deep in the red, falling 8.6% at the opening bell and hitting a fresh 52-week low of ₹770 apiece on NSE. The sharp fall in HDFC Bank shares comes after Atanu Chakraborty, in his resignation, wrote that “certain happenings and practices within the bank that he observed over the last two years were not in congruence with his personal values and ethics. "This is the basis of my aforementioned decision”.

Atanu Chakraborty, who joined the board of HDFC Bank in May 2021, further wrote, "My tenure on the board saw momentous events like the merger of the bank with HDFC Ltd that created a conglomerate under the Bank. This strategic initiative made HDFC Bank the second-largest bank in the country. Though the benefits of the merger are yet to fully fructify."

HDFC Bank has the highest weightage in the NIFTY50 index at 11.83%. Hence, a sharp fall in the HDFC stock today dragged down the overall market as NIFTY50 declined 597 points. As of 9:30 am, the NIFTY50 index trades 460 points or 1.9% lower at 23,317, with a day low of 23,180.

HDFC Bank is one of the crucial constituents of the benchmark indices with high weightage. Any sharp decline in the stock has a cascading impact on the overall market performance.

COVID-19 crash (down ▼ 26.8%)

In March 2020, HDFC Bank stock witnessed a sharp sell-off following the broader market crash after the COVID-19 pandemic. On 19 March, stock declined by 10.07%, followed by 12.6% fall on March 23. The sharp decline was not due to the bank’s weak business performance, but because of overall uncertainty about the economy and the financial system.

Investors were worried that people and businesses would struggle to repay loans following the pandemic, which could hurt the overall banking industry. However, HDFC Bank stock saw a smart recovery, rising nearly 17% in April, 2020.

RBI ban on digital expansion (down ▼ 5.1%)

In December 2020, the RBI announced a ban on HDFC Bank’s digital business due to multiple outages in its internet and mobile banking. The central bank asked HDFC Bank to stop all launches of digital business-generating activities and sourcing of new credit card customers. RBI lifted all restrictions on the bank in March 2022 after compliance. After initial weak sentiments, HDFC Bank's stock recovered from the stock fall.

Sharp fall after merger with HDFC Ltd (down ▼ 8.2%)

In July 2023, the stock fell sharply post-merger between HDFC Bank and HDFC Ltd as investors turned cautious amid concern around the lower margins, higher funding costs, and integration risks. However, this fall reflected uncertainty, not a fundamental weakness of the bank’s business. The stock saw a fall of less than 5% for the next four months but recovered fully in November and December 2023.

Weak quarterly earnings (down ▼ 14.4%)

In January 2024, HDFC Bank Q3 earnings did not meet market expectations. As a result, the stock declined 8.44% on January 17 and 3.3% on the next day, witnessing the worst single-day drop in nearly four years. Investors were concerned about flat net interest margins (NIMs) and lower-than-expected deposit growth, as well as a weak outlook following the merger with HDFC Ltd.

January 2026 fall (down ▼ 6.2%)

HDFC Bank saw a sharp decline again in January 2026 after the release of its Q3 business updates, as investors raised concerns over a high loan-to-deposit ratio (LDR) nearing 100%, slower deposit growth relative to loan demand, leading to a significant sell-off in the stock.