Buy HDFC Bank Ltd For Target 950 by Prabhudas Liladhar Capital Ltd
RBI approves Mr. Anup Bagchi as MD&CEO for 3 years
Mr. Anup Bagchi receives RBI approval to be appointed as MD & CEO for 3 years, w.e.f. 27th Oct’26. Being an IIT Kanpur and IIM Bangalore alumnus, Mr. Bagchi has been with the ICICI group for 34 years, working in banking, insurance, capital markets, treasury & wealth management with leadership roles at ICICI Bank, ICICI Securities and ICICI Prudential Life. As an Executive Director at ICICI Bank from 2017–23, he oversaw retail, business, rural and wholesale banking. Given his strong pedigree, we view Mr. Bagchi’s appointment positively although being an external candidate there could be changes in processes and management (mid/senior level) which could be disruptive in the short term.
Key fundamental issues that need to be addressed are
(1) improving the balancesheet construct i.e. LDR
(2) rebuilding NIM amid unfavourable loan mix
(3) better alignment between guidance and delivery. We keep multiple at 1.9x on Mar’28 core ABV and maintain TP at INR 950, Retain ‘BUY’.
Mr. Anup Bagchi receives RBI approval as MD & CEO:
The RBI, vide its communication dated 1st Oct’26, has approved the appointment of Mr. Anup Bagchi as MD & CEO of HDFC Bank for a 3-year period w.e.f. 27th Oct’26. The Bank’s Board, at its meeting held on 1st Oct’26, approved his appointment as an Additional Director w.e.f. 2nd Oct’26 and as MD & CEO w.e.f. 27th Oct’26, subject to shareholders’ approval. Mr. Jagdishan will complete his tenure as MD & CEO on 26th Oct’26.
Mr. Bagchi’s strong pedigree:
Mr. Bagchi has 34 years’ experience across banking, capital markets, wealth management and insurance, having been associated with the ICICI Group since 1992. He served as MD & CEO of ICICI Prudential Life and earlier as Executive Director at ICICI Bank; he also served as MD & CEO of ICICI Securities. His experience spans retail and wholesale banking, treasury, investment banking and digital financial services. He is a B.Tech from IIT Kanpur and an MBA from IIM Bangalore.
Strong track record across banking and insurance:
Mr. Bagchi was Executive Director at ICICI Bank from 2017–23, overseeing retail, business & rural banking and subsequently Wholesale Banking. During his tenure, ICICI Bank’s retail mortgage portfolio surpassed INR2trn while maintaining credit and cost discipline. Since Jun’23, he has been MD & CEO of ICICI Prudential Life.
PL Capital view:
We see Mr. Bagchi’s appointment as a positive given his strong track record of working at senior positions within the ICICI group. However, being an external candidate there could be some operational and management level changes which may be disruptive in the short-term. While execution under the new leadership remains a key monitorable, issues that may need consideration are
(1) improving the balance-sheet construct, particularly LDR
(2) addressing NIM pressure due to unfavourable loan mix
(3) ensuring better alignment between management guidance and actual execution
Please refer disclaimer at https://www.plindia.com/disclaimer/
SEBI Registration No. INH000000271
