Dallas, Texas 05/19/2014 (FINANCIALSTRENDS) – The stock of HDFC Bank Limited (ADR) (NYSE:HDB) gained 6.11% on Friday and closed at $46.18, around 1% above its recent 52 week high of $45.72. During the trade, the stock hit intraday and fresh 52 week high of $46.23. However, the stock of HDFC Bank was no exception but a part of hopeful rally in many Indian stocks, largely driven by hopes for reform following huge election win of Narendra Modi.
Other Indian stocks, listed on the U.S. stock exchanges which also precipitated the rally, include ICICI Bank Ltd (ADR)(NYSE:IBN) which gained 10.01% on Friday and marked new 52 week high of $51.03; and Tata Motors Limited (ADR)(NYSE:TTM) gained 2.70% and close near its 52 week high.
Sluggish Growth Story:
India’s economic growth slumped below 5% which was recorded well above 8% before the 2008 financial crisis. Budget deficits remain high and private investment growth was largely tapered, including foreign investments. Even its bureaucracy was labeled the worst in Asia with a score of 9.21 out of a worst possible 10 by a 2012 report compiled by the Political and Economic Risk Consultancy based in Hong Kong.
The prime reason that boosted rally in HDFC Bank Limited (ADR) (NYSE:HDB) and other Indian stocks is the hope of no nonsense, results oriented governance under the leadership of Narendra Modi. Mr. Modi is believed to be a pro-business leader who will catalyze much needed reforms to lift business investment and revive the Indian economy by cutting red tape. Mr. Modi is soon expected to sworn in as India’s prime minister as his Bharatiya Janata Party (BJP) has got clear electoral mandate.
HDFC Bank Limited (ADR) (NYSE:HDB) operates through its network of 3,251 branches and 11,177 ATMs in more than 2,000 cities and towns. The bank offers a range of financial products and services to retail and corporate consumers in India as well as in Hong Kong and Bahrain. Primarily, it operates in Retail Banking, Treasury, Wholesale Banking and Other Banking Operations.