Personally, I bank with both ICICI and HDFC and find the implementation of net banking better with ICICI. However, my concern is about loans made today with banks and how many of these loans might end up as NPAs tomorrow. We can’t know for sure, but I hope HDFC performs like they have performed in the past and have made sensible decisions when underwriting loans.
Would it be correct to say that we are in that stage of the debt cycle when the loans are given out, bank loan books are growing? If yes, then we will have to wait when the debt cycle reverses from the present stage and some of these loans go bad.
Isn’t it better to invest when the sentiments are bad for a company? I am hoping HDFC Bank can figure out the issues in the future. Even if the bank takes a few years to do this, it shouldn’t matter for investing with a long-term perspective. It just gives us more time to increase our stake if we choose to.
Disclosure: Invested in both HDFC and ICICI. HDFC is more of a recent investment than ICICI.
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