HDFC Bank shares jump 3% on CEO succession plan

Shares of HDFC Bank jumped more than 3% in early trade on Tuesday amid reports that the private lender has shortlisted two candidates for its next managing director and chief executive officer, narrowing the race to an internal and an external contender.

HDFC Bank shares rose 3.1% to ₹730.30 on the BSE, taking the bank’s market capitalisation to around ₹11.2 lakh crore. The stock, however, remains about 28% below its 52-week high of ₹1,020.35. It has gained around 7% from its 52-week low of ₹706.35, touched on August 11.

According to media reports citing people familiar with the matter, HDFC Bank has proposed deputy managing director Kaizad Bharucha as the internal candidate and Anup Bagchi, chief executive officer of ICICI Prudential Life Insurance, as the external candidate.

The development comes after HDFC Bank’s board on September 12 submitted two names, in order of preference, to the Reserve Bank of India (RBI) for approval for a three-year term. The bank did not disclose the names of the candidates in its exchange filing.

The succession process has been closely watched by investors after incumbent MD and CEO Sashidhar Jagdishan decided not to seek reappointment for a third term. Jagdishan’s second term ends on October 26, 2026.

HDFC Bank shares had witnessed a sharp correction over the past two weeks following Jagdishan’s decision, with investors assessing the potential impact of a leadership transition at India’s largest private sector bank.

Race to succeed Sashidhar Jagdishan narrow

Fortune India had first reported on September 8 that Bharucha was emerging as a strong internal contender for the top position, while the bank was also evaluating external candidates. The report had named Bagchi, Citi India’s K Balasubramanian, Tata Capital’s Rajiv Sabharwal and HDFC Life’s Vibha Padalkar among the names being considered.

The report had also highlighted a potential tenure constraint for Bharucha, who joined HDFC Bank’s board as a whole-time director in 2014.

Fortune India subsequently reported on September 12 that the HDFC Bank board had formally sent two names to the RBI in order of preference, without disclosing the candidates. The bank was understood to be weighing an insider succession against an external leader who could bring a fresh approach to the lender.

The RBI’s approval will now be key to determining who takes over from Jagdishan and leads HDFC Bank through its next phase of growth.

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