Synopsis: Domestic brokerage Motilal Oswal Financial Services has reiterated its ‘Buy’ rating on HDFC Bank (NSE: HDFCBANK) with a target price of ₹1,100, even as the stock hit a 52-week low on Friday, March 20, 2026. The brokerage believes the RBI’s endorsement of the bank’s governance and the swift appointment of an interim chairman will help the lender navigate its current leadership crisis.

Motilal Oswal HDFC Target: ₹1,100 Buy Rating After Chairman Exit

The banking giant remains at the center of a “trust deficit” storm following the abrupt resignation of Part-time Chairman Atanu Chakraborty on March 18.

While the market reacted with a massive sell-off, erasing over ₹1 lakh crore in valuation, institutional analysts are looking past the “ethical incongruence” allegations to focus on the bank’s underlying financial resilience and regulatory backing.

Brokerage View: Why ₹1,100 is Still the Goal

Motilal Oswal’s latest research report, released on March 20, 2026, highlights that the current price dip represents a valuation opportunity rather than a fundamental breakdown.

• RBI’s “Clean Chit”: A major factor behind the maintained target is the Reserve Bank of India’s rare public statement. The regulator confirmed there are “no material concerns” regarding the bank’s conduct, classifying it as a sound Domestic Systemically Important Bank (D-SIB).
• Leadership Continuity: The swift transition to Keki Mistry as Interim Chairman is seen as a move that “assuages concerns” regarding board stability during the post-merger integration phase.
• Valuation Comfort: At the current market price near ₹790, the stock trades at roughly 2.2x FY27E Adjusted Book Value (ABV). Analysts argue this is historically cheap for a franchise of HDFC Bank’s scale, which typically commands higher multiples.

The Challenges: Post-Merger and Ethics Allegations

Despite the bullish target, Motilal Oswal acknowledges significant near-term hurdles:

1. Sentiment Overhang: The pointed language in Chakraborty’s resignation letter—citing practices “not in congruence with personal values”—continues to spook retail and FII investors.
2. Delayed Response: The brokerage noted that the bank’s delayed response to the exit on March 18 may have worsened the initial panic, missing a window to address investor concerns proactively.
3. Deposit Pressure: The bank continues to manage a high Loan-to-Deposit Ratio (LDR), requiring it to grow deposits aggressively to sustain credit growth in a high-interest-rate environment.

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Market Snapshot: HDFC Bank (March 20, 2026)

The stock opened under pressure today, extending its decline as investors weighed the long-term impact of the leadership shift.

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