Please explain in detail the significance of pe ratio of hdfc.
Pe ratio of HDFC bank is 20 as of now.
Pe ratio mean price to earnings ratio, it means how much times of earnings an investor is paying the price. the current price of hdfc is 1675 and earnings till date is 82.31 hence pe ratio of hdfc can be verified as = 1675/82.31 = 20. it shows you have to pay 20 times of earnings to buy hdfc’s one share.it shows that market is expecting hdfc to grow 20 times in future that is why they are paying 20 times premium. The pe ratio we calculated is TTM i.e. Trailing till month. i.e. we are calculating the pe ratio based on recent earnings. The other type Pe ratio is static throughout the year because it is calculated based annual profit of previous year hence TTM Pe ratio is considered more accurate.
