What Makes HDFC Bank (HDB) a Worthy Investment?

Hardman Johnston Global Advisors, an investment management company, released its “Hardman Johnston Global Equity Strategy” investor letter for the fourth quarter of 2025. A copy of the letter can be downloaded here. Global equity markets delivered robust results in the quarter, backed by easing inflation trends and strong economic data. The Hardman Johnston Global Equity Strategy returned 2.91%, net of fees, compared to the MSCI AC World Net Index’s 3.29% gain. The Financials and Consumer Staples sectors contributed to the performance, while the Industrials and Consumer Discretionary sectors detracted from relative performance. In addition, please check the Strategy’s top five holdings to know its best picks in 2025.

In its fourth-quarter 2025 investor letter, Hardman Johnston Global Equity Strategy highlighted HDFC Bank Limited (NYSE:HDB) as a new portfolio addition. Incorporated in 1994, HDFC Bank Limited (NYSE:HDB) offers banking and financial services to individuals and businesses. HDFC Bank Limited (NYSE:HDB) fluctuated by about 39% over the last 52 weeks. On January 27, 2026, HDFC Bank Limited (NYSE:HDB) stock closed at $32.44 per share with a market capitalization of $166.383 billion.

Hardman Johnston Global Equity Strategy stated the following regarding HDFC Bank Limited (NYSE:HDB) in its fourth quarter 2025 investor letter:

“During the quarter we initiated positions in Cameco Corp., Citigroup Inc., Elanco Animal Health, Inc., HDFC Bank Limited (NYSE:HDB), and Vertiv Holdings Co. HDFC Bank Ltd. is the largest private-sector bank in India, supported by a strong deposit franchise and an extensive physical and digital distribution network. The merger with HDFC Ltd. over two years ago created a premier mortgage lending and servicing platform, which is now being rolled out across the bank’s branch network. This integration is expected to enhance branch productivity and unlock meaningful cross-selling opportunities, providing a durable tailwind to growth. HDFC Bank continues to expand its branch footprint at a faster pace than peers, with a strategic focus on underpenetrated rural and semi-urban markets, while simultaneously investing in digital capabilities to enhance customer engagement and accessibility. While synergy realization from the HDFC Ltd. merger has progressed more slowly than initially anticipated, this has created an attractive entry point at a discounted valuation. As integration advances, improvements in return on equity and loan-to-deposit ratios should support higher lending growth and a return toward pre-merger profitability levels. Over time, this is expected to drive stronger earnings growth and share price appreciation, supported by the favorable long-term growth outlook for the Indian economy.”

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HDFC Bank Limited (NYSE:HDB) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 47 hedge fund portfolios held HDFC Bank Limited (NYSE:HDB) at the end of the third quarter, up from 43 in the previous quarter. While we acknowledge the risk and potential of HDFC Bank Limited (NYSE:HDB) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than HDFC Bank Limited (NYSE:HDB) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered HDFC Bank Limited (NYSE:HDB) and shared the list of high growth dividend paying stocks to buy. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.