Vaishali Parekh of Prabhudas Lilladher has given a buy recommendation on Housing Development Finance Corporation (HDFC) with a target price of Rs Rs 2,060.

Shares of HDFC traded at Rs 1,964 around 1:20 pm on 13 May, 2019.

The analyst has set a two-week horizon for the stock to hit the target price and recommended keeping a stop loss at Rs 1,880.

March quarter highlights:

• HDFC, incorporated in the year 1977, is a largecap company (having a market cap of Rs 3,32,435.38 crore), operating in finance sector.
• The company reported a 26.80 per cent year-on-year (YoY) rise in standalone net profit at Rs 2,861.58 crore for the March quarter, which was better than Rs 2,600 crore estimated by analysts in an ETNow poll.
• The housing finance company (HFC) had reported Rs 2,256.68 crore profit in the same quarter last year.
• Net interest income (NII) for the quarter came in at Rs 3,163 crore against ET Now poll estimate of Rs 3,116 crore.
• The bank board has proposed a final dividend of Rs 17.50 per share for FY19, subject to approval of the members at the ensuing GM.

Investment rationale:

The stock has taken support near the 200-DMA at Rs 1,900. It has formed a double-bottom formation pattern on the daily chart and has signified strength to carry the stock further upward in the coming days, said Parekh.

"The RSI has indicated improvement and with the chart also looking attractive, we recommend a buy in this stock for an upside target of Rs 2,060, keeping a stop loss of Rs 1,880," she added.