Investec raises HDFC target as co should benefit from the liquidity crisis

Investec expects HDFC to grow at 16 percent compounded annual growth rate (CAGR) over the medium-term.

Housing Development Finance Corporation shares gained a percent in morning on Thursday as Investec believes company should benefit from the liquidity crisis on account of its strengths on liability side.

While having a buy call on the stock, the research house raised its target price to Rs 1,950 from Rs 1,825 earlier, implying a 4 percent potential upside.

Investec expects HDFC to gain market share in the current year, preserving its profitability, and expects more than 14 percent value compounding over medium-term.

The research house also expects the housing finance company to grow at 16 percent compounded annual growth rate (CAGR) over the medium-term.

IL&FS-led debt crisis in September not only hit non-banking finance companies but also housing finance companies, which resulted into sharp fall in stock prices of these companies.

Most analysts believe this crisis is expected benefit to banks as well as big companies which can able to manage funding, but small NBFCs & HFCs may find it difficult.

At 10:55 hours IST, the stock was quoting at Rs 1,883.25, up Rs 15.35, or 0.82 percent on the BSE.

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