Trailing profit is $1.59 a share. I model $1.75 next year at fourteen times, a $24.50 stock, a market-like return from $23 including the dividend.
Key points
- $1.59 trailing twelve-month Indian-GAAP profit per ADS at ₹94.77 per dollar.
- 3.32% net interest margin on earning assets in the September quarter, down again.
- 14 times my $1.75 of next-year earnings produces a $24.50 target.
The call
The $23.08 price needs about 13 times $1.75 of next-year earnings. That is a modest multiple for India’s largest private bank after a 37 percent twelve-month drop, but it still assumes funding mix improves as the new CEO claims it will.
I believe profit grows about 10 percent, not a re-rating. CASA is 31.6 percent of deposits, special FCNR funds added four points to deposit growth, and funding cost stayed 4.4 percent. Asset quality is clean at 1.11 percent gross NPA. That mix supports a mid-teens multiple, not twenty.
Consolidated profit after tax (₹ thousand crore)Indian GAAP, company releases through Oct 17 2026. FY28E is my 10% lift on trailing four quarters.
Valuation
| Item | Figure |
|---|
| Trailing four-quarter profit | $8.45 billion |
| ADS count used | 5.31 billion |
| Trailing EPS | $1.59 |
| My FY28E EPS (10% growth) | $1.75 |
| Multiple | 14 times |
| 12-month target | $24.50 |
Fourteen times is a franchise multiple after a large drawdown, not a growth premium. If I am right the stock tracks the market plus a $0.41 dividend; if margins stall, the same earnings at twelve times is a $21 stock.
Risks
- CASA mix stays near 32 percent, so the promised margin upturn never shows in the next two prints.
- Insurance-commission cuts or priority-sector shortfalls hit fee and yield lines harder than volumes offset.
- Rupee weakness cuts the dollar dividend and the ADS translation of rupee earnings.
What would change my mind
Two sequential quarters of NIM above 3.40 percent with CASA rising would support a higher multiple and a buy.