SWOT Analysis
Strengths
1. HDFC is the strongest and most venerable play on Indian mortgages over the long term. The management of the bank is termed to be one of the best in the country.
2. HDFC has differentiated itself from its peers with its diversified network and revamped distribution strategy
3. HDFC has been highly proactive in passing on the cost and benefit to customers.
4. Besides the core business, HDFC’s insurance, AMC, banking, BPO, and real estate private equity businesses are also growing at a rapid pace and the estimated value of its investments/subsidiaries explains ~30% of HDFC’s market capitalization.
Weaknesses
1. High dependence on individual loans.
2. Major stake held by American financial groups which are under stress due to economic slowdown.
Opportunities
1. Fast growing insurance business in the country.
2. Untapped rural markets.
Threats
1. Loss of market share to commercial banks and HFC’s
2. Higher than expected increase in funding cost
3. Risk of fraud and NPA accretion due to increase in interest rates and fall in property prices is inherent to the mortgage business.
Strengths
1. HDFC is the strongest and most venerable play on Indian mortgages over the long term. The management of the bank is termed to be one of the best in the country.
2. HDFC has differentiated itself from its peers with its diversified network and revamped distribution strategy
3. HDFC has been highly proactive in passing on the cost and benefit to customers.
4. Besides the core business, HDFC’s insurance, AMC, banking, BPO, and real estate private equity businesses are also growing at a rapid pace and the estimated value of its investments/subsidiaries explains ~30% of HDFC’s market capitalization.
Weaknesses
1. High dependence on individual loans.
2. Major stake held by American financial groups which are under stress due to economic slowdown.
Opportunities
1. Fast growing insurance business in the country.
2. Untapped rural markets.
Threats
1. Loss of market share to commercial banks and HFC’s
2. Higher than expected increase in funding cost
3. Risk of fraud and NPA accretion due to increase in interest rates and fall in property prices is inherent to the mortgage business.
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