HDFC Bank Surpasses ICICI Bank as Top Choice for Global EM Funds with Record Ownership

HDFC Bank is the most critical emerging-market bank globally, held by 71% of EM funds, making it the most significant EM bank in global portfolios. The bank's strategic importance has deepened since its merger with parent HDFC in 2023. Allocations to HDFC Bank have surged, with 13 new funds initiating positions in the past six months, while only one exited.

HDFC Bank has cemented its status as the most critical emerging-market bank globally, with 71% of actively managed EM funds holding the stock. This significant representation underscores the bank's strategic importance, which has deepened since its 2023 merger with parent Housing Development Finance Corp (HDFC) [2].

The bank's strategic significance has been further bolstered by the integration, which has created a larger balance sheet, expanded retail reach, and improved its funding profile. This has driven stronger allocations from funds compared to other major emerging-market banks such as ICICI Bank, Banorte, and Bank Central Asia [2].

Over the past six months, 13 new funds have initiated positions in HDFC Bank, while only one exited, reflecting its enduring appeal to global money managers. The average portfolio weight in HDFC Bank stands at 1.78%, slightly below its 2023 peak but well above historical norms [2].

HDFC Bank's shares have risen nearly 20% over the past year, outperforming the MSCI EM index and dramatically outpacing the Nifty 50, which has slipped 1.5% [2].

References:
[1] https://www.marketbeat.com/instant-alerts/filing-1832-asset-management-lp-sells-87474-shares-of-hdfc-bank-limited-hdb-2025-08-23/
[2] https://www.business-standard.com/markets/news/hdfc-bank-tops-emerging-market-portfolios-with-71-percent-fund-ownership-125082800122_1.html