HDFC Bank has started trading much below it’s long term P/B which is now in line with ICICI bank. At this valuation the stock seems to be a steal. But an analysis on the shift seems important before taking any decision, as there has been a clear change in perception for this to occur.
Last time I analysed both banks, ICICI bank made a stronger candidate for investment; their NII growth had been higher than HDFC since H2FY19, NIM had also been increasing (surpassing HDFC bank in Q1FY23) and asset quality had significantly improved… With these finding I had added to the existing investment as stock re-rating and improving profitability was the thesis.