Reuters Market Eye - Shares in Housing Development Finance Corp Ltd fall as much as 2.9 percent on worries about the negative impact from the RBI guidelines under which banks would be exempted from reserve requirements when raising long-term bonds for infrastructure.
UBS downgrades HDFC to "neutral" from "buy" and cuts price target to 1,075 rupees from 1,100 rupees.
The investment bank says HDFC could be impacted by more aggressive pricing on loans by banks, while competition to raise long-term bonds could push up long-term rates.
HDFC shares down 2.2 percent at 0416 GMT.
(Reporting by Indulal PM)