TODAY WE PURCHASED SHARES OF HDFC BANK
Today I made a first entry into $HDB (HDFC Bank Ltd-ADR) shares in the portfolio.
As I usually do whenever I add a new company to the portfolio, let’s analyze together the reasons behind this purchase.
Let’s start with the company.
HDFC Bank is the largest private bank in India by market capitalization and is now one of the largest banks in the world. After the merger with HDFC Ltd., it has firmly positioned itself among the major global banking institutions by market value, with a capitalization that places it among the leading banks worldwide.
The bank is headquartered in Mumbai and was founded in 1994. Over time it has grown to serve more than one hundred million customers through thousands of branches spread across the country.
Its business model is relatively simple to understand.
The bank collects deposits through current and savings accounts and uses those funds to provide loans to households and businesses. Its main products include mortgages, personal loans, auto loans, credit cards, and banking services for companies.
The core of the business is strongly domestic. A significant portion of its revenue comes from Indian customers’ current accounts and deposits, as well as from loans provided to the domestic economy.
This aspect is one of the main reasons behind the investment.
Buying HDFC Bank allows me to gain direct exposure to the Indian economy, one of the fastest-growing major economies in the world.
At the same time, since the business is strongly linked to India’s internal growth, it adds to the portfolio an exposure that is less correlated with many global companies tied to technology or artificial intelligence.
Let’s now look at a few financial indicators to better understand the quality of the business.
One of the most commonly used metrics when analyzing a bank is Return on Equity (ROE), which measures the return the bank generates on shareholders’ capital. In the case of HDFC Bank, ROE is around 14–15%, a level generally considered solid for the banking sector.
Another important indicator is credit quality. The ratio of non-performing loans to total loans is around 1–1.3%, a relatively low figure that reflects prudent risk management.
In simple terms, this means that only a small portion of the loans granted by the bank becomes problematic, which is a key factor for the stability of a financial institution.
From a portfolio perspective, this investment adds three interesting elements:
– exposure to one of the most dynamic economies in the world
– a banking business linked to the domestic growth of India
– diversification compared with many global companies more exposed to the technology cycle
Regarding position management, today I made an initial entry of about $2,500.
As always, I never consider a purchase as a single operation. I have already identified additional entry levels in case the price declines further, allowing me to build the position over time.
The goal is not to guess the perfect price, but to gradually build exposure to companies that I consider attractive for the long term.
Have a great day everyone
@LucaMulargiu... Show More
Not investment advice. The author may have financial interests in the mentioned instruments.
We use our own and third-party cookies on our websites to enhance your experience, analyze traffic, and for security and marketing. For more info, see our Cookie Policy or go to Manage Settings.
Privacy Preference Center
When you visit any website, it may store or retrieve information on your browser, mostly in the form of cookies. This information might be about you, your preferences or your device and is mostly used to make the site work as you expect it to. The information does not usually directly identify you, but it can give you a more personalized web experience. Because we respect your right to privacy, you can choose not to allow some types of cookies. Click on the different category headings to find out more and change our default settings. However, blocking some types of cookies may impact your experience of the site and the services we are able to offer.
More information
Manage Consent Preferences
Strictly Necessary Cookies
Always Active
These cookies are necessary for the website to function and cannot be switched off in our systems. They are usually only set in response to actions made by you which amount to a request for services, such as setting your privacy preferences, logging in or filling in forms. You can set your browser to block or alert you about these cookies, but some parts of the site will not then work. These cookies do not store any personally identifiable information.
Performance Cookies
These cookies allow us to count visits and traffic sources so we can measure and improve the performance of our site. They help us to know which pages are the most and least popular and see how visitors move around the site. All information these cookies collect is aggregated and therefore anonymous. If you do not allow these cookies we will not know when you have visited our site, and will not be able to monitor its performance.
Functional Cookies
These cookies enable the website to provide enhanced functionality and personalisation. They may be set by us or by third party providers whose services we have added to our pages. If you do not allow these cookies then some or all of these services may not function properly.
Targeting Cookies
These cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.
Cookie List
label
ConsentLeg.Interest
label
label
label
Thu May 21 2026 04:09:43 GMT+0000 (Coordinated Universal Time)
