Reuters Market Eye - Kotak Institutional Equities downgrades HDFC Bank (HDBK.NS) to "reduce" from "add", though it raises the target price to 575 rupees from 565 rupees. HDFC shares flat at 586.85 rupees.
Kotak says HDFC Bank trading at "expensive" multiples of 3.3 times fiscal 2014 book and 16 times EPS, sees "limited scope for near-term appreciation."
The brokerage says "maintaining the current pace of earnings growth may be difficult over the medium term as loan growth is about 20 percent."
The downgrade comes even after India's third-biggest lender beat forecasts on Friday with a 30.6 percent rise in April-June net profit.