Two of India’s biggest private banks—HDFC Bank and ICICI Bank—have shown strong performance in the fourth quarter of FY25. Both banks posted better-than-expected results, and their stocks have gained over 7% in just one week. Now, investors are wondering: after this recent surge, which stock is better placed for future growth?
Here’s a simple breakdown of both banks based on key financial indicators like valuation, loan and deposit growth, net interest margin (NIM), and what top brokerages are saying about their future.
ICICI Bank and HDFC Bank Stock Valuation: What Numbers Say
Valuation is one of the most important factors for investors.
- ICICI Bank is currently trading at 3.1 times its price-to-book (P/B) ratio.
- HDFC Bank is slightly cheaper, trading at 2.6 times its P/B ratio.
This means that HDFC Bank is a bit more attractively priced when compared to ICICI Bank, but pricing alone doesn’t tell the whole story.
Brokerage Targets: What Experts Predict
🔹 HDFC Bank
- Jefferies: ₹2,340 target (23% upside)
- Macquarie: ₹2,300 target (20% upside)
- CLSA: ₹2,200 target (15% upside)
- Nuvama: ₹2,195 target (15% upside)
🔹 ICICI Bank
- Jefferies: ₹1,710 target (22% upside)
- Macquarie: ₹1,670 target (18% upside)
- CLSA: ₹1,700 target (21% upside)
- Nuvama: ₹1,630 target (15% upside)
Verdict: Both banks have strong growth potential according to analysts, but HDFC Bank could offer slightly better returns if it meets expectations.
Loan Growth: Who Is Lending More?
Loan growth shows how actively a bank is giving out new credit, which is a key revenue driver.
📊 Quarterly Loan Growth
| Quarter | ICICI Bank | HDFC Bank |
| Q1 FY25 | 15.1% | 52.5% |
| Q2 FY25 | 15.7% | 7.0% |
| Q3 FY25 | 14.1% | 3.0% |
| Q4 FY25 | 14.0% | 5.4% |
- ICICI Bank has shown consistent loan growth each quarter.
- HDFC Bank had a strong Q1 due to merger effects but has slowed down in later quarters.
For FY25, ICICI Bank is expected to maintain 14.7% loan growth, while HDFC Bank may face pressure due to weaker credit expansion and deposit issues.
Deposit Growth: Where Are People Saving?
Deposits are a key source of funding for banks. Here’s how the two banks performed:
📊 Quarterly Deposit Growth
| Quarter | ICICI Bank | HDFC Bank |
| Q1 FY25 | 15.1% | 24.4% |
| Q2 FY25 | 15.7% | 15.1% |
| Q3 FY25 | 14.1% | 15.85% |
| Q4 FY25 | 14.0% | 1.15% |
- ICICI Bank has shown steady and strong deposit growth throughout the year.
- HDFC Bank started strong but has sharply slowed down in Q4.
Experts believe that HDFC Bank’s low-cost CASA (Current Account Savings Account) mix is under pressure, which is affecting its deposit growth and liquidity strength.
Net Interest Margins (NIMs): Who Is Earning More?
Net Interest Margin reflects the bank’s earnings from interest versus what it pays on deposits.
📊 Quarterly NIMs
| Quarter | ICICI Bank | HDFC Bank |
| Q1 FY25 | 4.36% | 3.7% |
| Q2 FY25 | 4.27% | 3.7% |
| Q3 FY25 | 4.25% | 3.6% |
| Q4 FY25 | 4.41% | 3.7% |
ICICI Bank has consistently maintained higher NIMs than HDFC Bank across all quarters. Even in a softer interest rate environment, ICICI’s margins are holding strong.
HDFC Bank’s NIMs have remained stable at around 3.6–3.7%, but they have not shown major improvement yet.
Asset Quality and Risk Indicators
While the report didn’t provide direct Non-Performing Asset (NPA) figures, it is widely known that both ICICI and HDFC have low NPAs and are considered stable.
- ICICI Bank is seen as more agile in adjusting its credit book, with steady asset quality.
- HDFC Bank, post its merger with HDFC Ltd., is still going through adjustments that could affect short-term performance metrics.
Investor Outlook: Which One Looks Stronger?
After analyzing all major factors—valuation, loan/deposit growth, and NIM—here’s a simple summary:
| Factor | Stronger Bank |
| Stock Valuation | HDFC Bank (cheaper) |
| Loan Growth | ICICI Bank |
| Deposit Growth | ICICI Bank |
| NIM | ICICI Bank |
| Broker Targets | Slight edge to HDFC |
ICICI Bank appears more stable with consistent performance across key metrics, especially in deposit growth and NIMs.
HDFC Bank, though valued more attractively and backed by strong broker targets, is still navigating post-merger adjustments and slower growth.
Both are fundamentally strong, but based on current data, ICICI Bank may offer a more balanced risk-return opportunity in the near term.
