HDFC Bank- we understand your world

While we can compare HDFC Bank with Global peers, we may also have to consider reasons behind the low valuations of Global peers:

1. Very low GDP growth in the past decade. Even though this is on high base, but still recession fears were there during this period where as in India, at least recession fears may not be there.
2. Per Capita Income in India is one of the lowest in the world (around 2100 USD) which is lower than Asian peers. Though this is Negative but at least it may not go down further. In fact it may go up in next 30+ years and thus Financial investments may go up. Lot of efforts will be required at an individual level to uplift large population out of poverty and also to ensure that Per Capita Income should at least become comparable with Asian peers. Only then Banks can grow, along with MF(s).
3. Risk taken by Global banks might be higher due to their exposure across the world, which may not be case with HDFC Bank. This may change in future as they may like to expand outside India.

Though there are lot of Negative factors which may ensure that, HDFC Bank will find it difficult to grow beyond 15% but still this growth rate looks good.

Views could be biased as invested in HDFC Bank.