HDFC Bank's 3% decline triggers 750-point fall in Nifty Bank
What's the story
A 3% drop in HDFC Bank's shares, along with a sell-off in other banking stocks, has led to a decline in Nifty Bank.
The banking index fell about 750 points or 1.6% to trade at 45,310.35. All index stocks, except ICICI Bank, are trading in the red.
The selling in banking stocks has also put pressure on benchmark indices Nifty 50 and Sensex, dragging them down by nearly 1.7%.
Details
Banking stocks fall in HDFC's footsteps
At the time of writing, HDFC Bank shares were down by 3.41% at Rs. 1,428.30 apiece.
The negative effects of HDFC Bank's decline were also felt among other banking stocks.
IDFC First Bank experienced a drop of over 6%, while Punjab National Bank fell by 4%.
IndusInd Bank and AU Small Finance Bank were also among the top losers. Bank of Baroda dropped by over 4%
ICICI Bank was the only gainer, with its shares rising 2% to Rs. 1028.70.
Reason
Why HDFC Bank stock is on a decline
HDFC Bank—India's largest private bank—went down 15% in the last week following disappointing Q3 results.
The stock continues to see heavy selling. The bank's Q3 results showed a strain on margin, slow deposit growth, and a decade-low earnings per share (EPS).
Last week, brokerage firm CLSA has recommended a "buy" for HDFC Bank, setting a target price of Rs. 2,025, which is nearly a 42% increase from current levels.