Long-term investors can buy the shares of HDFC Bank (₹1,856) at current levels. The prolonged consolidation in the stock has come to an end. The strong rise and close above ₹1,800 last week have confirmed the range breakout.
Before the recent rise, HDFC Bank’s share price oscillated between ₹1,270 and ₹1,760 since 2021. So, the breakout above ₹1,800 has turned the outlook bullish. It also indicates that the broader uptrend has resumed. Moving average cross-overs on the weekly chart also strengthens the bullish case. Strong supports are in ₹1,780 and then in the ₹1,700-₹1,670 region.
Considering the breakout after almost four years, we expect the stock to sustain above ₹1,780. This is because fresh buyers can enter the market as the stock dips towards ₹1,800. HDFC Bank’s share price can rise to ₹2,100-₹2,220 over the next couple of quarters. Thereafter, a corrective fall to ₹2,000-₹1,900 is a possibility. But eventually, we expect the stock to breach ₹2,200. Such a break can take HDFC Bank’s share price up to ₹2,400 over the next twelve to eighteen months.
Long-term investors can buy HDFC Bank now at ₹1,856. Accumulate on dips at ₹1,790. Keep the stop-loss at ₹1,580. Trail the stop-loss up to ₹1,950 as soon as the stock goes up to ₹2,100. Move the stop-loss further up to ₹2,220 when the price touches ₹2,340. Exit the stock at ₹2,400.