HDFC Bank shares rose 1% to 728.6 rupees at 9:37 a.m. IST after the bank named Bagchi as the new CEO. He succeeds Sashidhar Jagdishan, whose term ends on October 26. Brokerages said the appointment helps the bank, noting, "A key overhang surrounding the bank's leadership has been removed."
Bagchi succeeds Sashidhar Jagdishan, who decided in August not to seek reappointment after his second three-year term ends on October 26.
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Shares were trading about 1% higher at 728.6 rupees as of 9:37 a.m. IST.
Brokerages said the appointment is expected to serve HDFC well.
It allows the bank to optimise its operating structure and leadership team to better achieve growth, profitability and governance objectives, said Jefferies.
A key overhang surrounding the bank's leadership has been removed, noted Motilal Oswal, adding that Bagchi brought an external perspective at a time when the firm is seeking to rebuild investor confidence.
His experience across retail and wholesale banking, digital financial services, capital markets, wealth management and insurance will be an asset across HDFC's BFSI segments, the brokerage added.
Emkay Global said stability in upper management, reviving deposit growth and improving productivity of newer branches would be key priorities for the incoming CEO.
Jagdishan, who succeeded Aditya Puri as HDFC Bank CEO, had been expected to remain in the role despite having less than three years before reaching the regulatory tenure limit.
His departure follows Chairman Atanu Chakraborty's abrupt March resignation over governance concerns that an independent legal review did not substantiate.
The bank on Saturday posted a jump of around 18.8% in its deposits and a 16.3% rise in its gross advances as of September end.