Mumbai, Aug. 20 -- The revised target implies an upside of around 25% from Wednesday's closing price of Rs 681.10. The brokerage said the company's asset quality has improved, with the June quarter marking a meaningful improvement despite being seasonally weak.

The brokerage also said the recent correction in the stock has made its valuation attractive and offers significant upside. It expects HDB Financial Services' return on equity (ROE) to increase to 16.8% by FY29 from 14% in FY26.

The brokerage expects earnings per share (EPS) to grow at a compound annual growth rate (CAGR) of 26% between FY26 and FY29, compared with flat growth during FY24-FY26. It said the stock's FY28 price-to-book value of 2 times and price-to-earnings multiple...