Shares of HDFC Bank tumble to their lowest point in over two years, amid persistent foreign investor sell-offs and subdued profit margins, despite positive broker outlooks and ongoing support from domestic investors.
HDFC Bank shares slid to an over two-year low on Tuesday, extending a sharp run of underperformance that has seen the stock fall 12% in the past month, even as the BSE Sensex has edged higher. Exchange data showed the private lender’s shares touched ₹726.50 in intraday trade, slipping below a previous low of ₹726.75 reached on April 2. That was its weakest level since May 2024.
The decline has been more severe over a longer horizon. HDFC Bank is down 27% so far in 2026, compared with an 8.2% fall in the Sensex. At 10:50 a.m. on Tuesday, the stock was trading 0.55% lower at ₹727.95, while the benchmark was down 0.47%.
Investors have also been trimming exposure. Shareholding data show foreign portfolio investors reduced their stake in the bank for a fifth straight quarter, cutting holdings to 41.83% at the end of June from 44.05% in March. Domestic institutional investors raised their holding to 41.9% in the June quarter, while individual shareholders lifted their stake to 16.3%.
Brokerages remain broadly constructive despite the recent weakness. In its annual report for fiscal 2026, the bank said it remains well placed to capture housing demand, helped by urbanisation and its large home loan portfolio after the merger. Analysts at Nirmal Bang said the April-to-June quarter showed profit growth of 5% year on year to ₹19,100 crore, although net interest margins disappointed. Motilal Oswal described the quarter as largely in line, while ICICI Securities said the appointment of a chairman provided comfort even as the decision on extending the managing director and chief executive remained pending.
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