Citi has a buy call on HDFC Bank with a target price of Rs 2,590.The current market price of HDFC Bank is Rs 2,090.65.Time period given by the brokerage is year when HDFC Bank price can reach the defined target.Citi's view on the company:Deputy MD resigns - With the resignation of Mr.
Paresh Sukthankar, Deputy MD, the chances of an external candidate becoming the next MD/CEO increase significantly in our view.
When Mr.
Sukthankar was elevated to the position of Deputy MD in December 2013 he was widely seen as the internal candidate to become the next MD.
Some investors might be concerned with this development as this resignation comes just a week after the bank raised equity capital of ~INR 150bn via QIP and ADR.Timing of the resignation surprising Mr.
Puri still has more than two years before his term as MD ends in October 2020.
Hence, we find the timing of Mr.
Sukthankar's resignation a bit surprising.
At an analyst meet in May 2018, Mr.
Puri had suggested the bank would consider both internal and external candidates for the role of the next MD and that the name would be announced at least a year before Mr.
Puri retires.Some short-term business impact likely Mr.
Sukthankar has been with the bank since its inception in 1994 and has played an integral role in shaping the bank's strategy and its transformation into one of the leading financial institutions in the country.
His key responsibilities include credit and risk management, finance, HR, amongst others.
While the bank has put in a lot of systems and processes over the years, losing someone as experienced as him could create some short-term disruption in our view.