I have been reading posts regarding the HDFC base or market cap being so huge that it can’t grow further. One question comes to my mind, what’s stopping HDFC from growing, market cap is just a number. India’s population is 1.4B and a bank account is a must in today’s world, do you really think 1.4B people have a bank account in India, I don’t think so. Plus, nowadays people keep more than one bank account. HDFC Bank is the private sector leader, people always prefer the leader even in our day-to-day life if it’s not damn expensive.
After the merger, HDFC Bank provides everything in one place i.e. Demat, Home Loan, Vehicle Loan, Personal Loan, Saving Account, etc.
India is still a growing country, we are damn far away from the “developed country” tag. I don’t understand the economy well but one thing is for sure the finance sector will be the most beneficial sector in a growing country.
I’m not sure what exactly is deteriorating but it’s a life cycle of all companies I don’t think that should be a concern.
In the end, it’s all about with whom you are comparing HDFC Bank
- If you are comparing with other large caps in India, then HDFC Bank will do better.
- If you are comparing with global banks, totally illogical comparison.
- If you are comparing with small-mid caps then obviously HDFC bank won’t be a multi-bagger in the next couple of years but we might see a sudden jump to give it a fair valuation.
Dis: Heavily invested (> 10%) through MFs (Index Fund + Parag Parikh Flexi Cap Fund)
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