Foreign Institutional Investors Reduce HDFC Bank Stake by 3.6 Percentage Points in Q4 Amid 26% Decline in Stock Value

Foreign Institutional Investors Offload 3.62% Stake in HDFC Bank Amid Volatility

Foreign institutional investors (FIIs) sold a significant 3.62% stake in HDFC Bank during the March 2026 quarter, amidst the volatility in the Indian stock market. According to the shareholding pattern available on the National Stock Exchange (NSE), FIIs sold 47.95 crore shares of HDFC Bank during the quarter, resulting in a decline of their holding to 44.05% from 47.67% in the previous quarter.

The number of FII investors in the bank also fell to 2,528 at the end of March from 2,757 in December 2025. This decline in FII holdings was part of a broader trend of FIIs being net sellers in the recently concluded quarter, with March witnessing the largest sell-off in the Indian stock market. The ongoing US-Iran war and rising crude oil prices were the primary factors contributing to this sell-off.

In the cash segment, FIIs offloaded equities worth ₹1.22 lakh crore last month, taking the total outflows to ₹1.70 lakh crore in Q4.

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Shareholding Pattern Comparison

While FIIs were net sellers, India's biggest Domestic Institutional Investor (DII), Life Insurance Corporation of India (LIC), also trimmed its stake marginally during the March quarter to 4.66% from 4.67% in the previous quarter.

On the other hand, mutual funds increased their stake in HDFC Bank in the March quarter to 29.54% by acquiring roughly 2.88% stake or 38.67 crore shares.

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

HDFC Bank Share Performance in Q4

HDFC Bank's share price fell by 25.97% during the fourth quarter of the last financial year, with a 17% decline recorded in March alone. The banking stock faced intense selling pressure in March after the sudden resignation of chairman Atanu Chakraborty. Chakraborty cited "certain happenings and practices" over the past two years that conflicted with his values as the reason behind his resignation.

This sparked concerns around corporate governance, leading SEBI to examine the contents of his resignation letter. HDFC Bank's stock has also seen a sharp de-rating in the last few months, partly led by macro concerns.

HDFC Bank Q4 Update

India's largest private sector lender reported its business update for the fourth quarter. As per the exchange filing, average advances under management for the March 2026 quarter came in at ₹29.64 lakh crore, marking a roughly 10% increase from ₹26.96 lakh crore in the corresponding period last year.

As of March 31, 2026, advances under management at the end of the period were about ₹30.58 lakh crore, up 10.2% from ₹27.73 lakh crore a year ago. Meanwhile, period-end gross advances stood at around ₹29.60 lakh crore, registering a 12% rise compared with ₹26.44 lakh crore as of March 31, 2025.

On the liabilities side, average deposits for the March 2026 quarter climbed to ₹28.51 lakh crore, reflecting a 12.8% growth from ₹25.28 lakh crore in the year-ago period. Within this, average CASA deposits were ₹9.18 lakh crore, up 10.8% from ₹8.29 lakh crore, while average time deposits increased by 13.7% to ₹19.33 lakh crore from ₹16.99 lakh crore.

HDFC Bank Share Price Trend

Private lender shares rose as much as 2% to ₹765.60 apiece in Monday's trading session. The stock opened at ₹759 per share today, as compared to the previous close of ₹750. HDFC Bank's share price has largely remained under pressure in the near-term, shedding 23% on a year-to-date (YTD) basis.