HDFC Bank shares may underperform peers

Brokerages said the decline in net interest margins was a disappointing factor. Even as most of the brokerages have maintained a 'buy' rating, they said the stock is not likely to outperform other large lenders. The stock ended down 4.7% at ₹1,395.35 on Monday.

Brokerages said uncertainties surrounding the merger could weigh on the stock going forward.

CLSA maintained a 'buy' rating on HDFC Bank but said it prefers ICICI Bank, Axis Bank and SBI over HDFC Bank.

Kotak Institutional Equities said the stock is unlikely to be an outperformer among large banks.

We are again at a point where the risk of further de-rating is high if more uncertainties arise during the merger