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Informist, Saturday, Jul. 19, 2025

 

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--HDFC Bank Apr-Jun net profit INR 181.55 bln 
--Analysts saw HDFC Bank Apr-Jun net profit at INR 173.12 bln 
--HDFC Bank Apr-Jun net profit INR 181.55 bln vs INR 161.75 bln yr ago 
--HDFC Bank Apr-Jun total income INR 992.0 bln vs INR 837.01 bln year ago 
--HDFC Bank to pay INR 5 per share special interim dividend 
--HDFC Bank special interim dividend record date is Fri 
--HDFC Bank board approves 1-for-1 bonus share issue 
--HDFC Bank bonus share record date is Aug 27 
--HDFC Bank Apr-Jun provisions INR 144.42 bln vs INR 26.02 bln year ago 
--HDFC Bank gross NPA ratio 1.40% as on Jun 30 vs 1.33% quarter ago 
--HDFC Bank net NPA ratio 0.47% as on Jun 30 vs 0.43% quarter ago 
--HDFC Bank capital adequacy ratio 19.88% as on Jun 30 
--HDFC Bank Apr-Jun net interest income INR 314.4 bln, up 5.4% on year 
--HDFC Bank Apr-Jun core net interest margin on total assets at 3.35% 
--HDFC Bank Apr-Jun avg deposits INR 26.58 tln, up 16.4% on year 
--HDFC Bank gross advances INR 26.53 tln as on Jun 30, up 6.7% on year 
--HDFC Bk Apr-Jun net revenue includes INR 91.3 bln gain on HDB Fincl divest 
--HDFC Bank Apr-Jun cost-to-income ratio at 39.60% 
--HDFC Bank Apr-Jun non-interest income INR 217.30 bln, up 104% on year 
--HDFC Bank Apr-Jun non-interest income up 104% YoY on HDB Fincl stake sale 
--HDFC Bank: Liquidity coverage ratio at 124% as on Jun 30 
--HDFC Bank: Retail loans at INR 15.22 tln as on Jun 30, up 8.1% on year 
--HDFC Bank Apr-Jun credit cost at 56 bps vs 48 bps qtr ago 
--HDFC Bank Apr-Jun cost of funds at 4.8% vs 4.9% qtr ago 
--HDFC Bank Apr-Jun yield on assets at 8.1% vs 8.3% qtr ago 
--HDFC Bank Apr-Jun slippages INR 90 bln vs INR 75 bln qtr ago 
--HDFC Bk Apr-Jun recoveries, upgrades INR 42 bln vs INR 50 bln qtr ago 
--HDFC Bank: Apr-Jun write-offs INR 30 bln vs INR 33 bln qtr ago 

 

By Kabir Sharma

 

MUMBAI – Despite a sharp rise in provisions, HDFC Bank Ltd. managed to beat Street expectations on net profit in the June quarter on the back of a stake sale in its subsidiary, HDB Financial Services Ltd. Other income of the bank more than doubled due to the stake sale, which gave a fillip to the bottom line of India's largest private sector lender.

 

HDFC Bank reported a net profit of INR 181.55 billion for the quarter ended June, up 12.2% on year and higher than analysts' estimate of INR 173.12 billion. Sequentially, however, the net profit of the bank rose a mere 3.1%. 

 

The bank's net revenue was INR 531.7 billion for Apr-Jun, which includes transaction gains of INR 91.3 billion from a partial divestment through an offer for sale in the recent initial public offering of HDB Financial Services. This helped the bank report a healthy growth in bottom line despite its provisions rising a mind-boggling 455% on year to INR 144.42 billion in the reporting quarter.

 

Total income of the bank rose 18.5% on year to INR 992 billion in the quarter ended June. Net interest income for the quarter grew 5.4% to INR 314.4 billion from INR 298.4 billion year ago. Core net interest margin was at 3.35% on total assets, reflecting assets repricing faster than deposits, as against 3.46% for the prior quarter. 

 

Due to gains from the stake sale in HDB Financial Services, other income of the bank more than doubled on year and was up 81% on quarter at INR 217.30 billion in the reporting quarter. The four components of other income were fees and commissions of INR 75.9 billion, foreign exchange and derivatives revenue of INR 16.3 billion, net trading and mark-to-market gains of INR 101.1 billion, and miscellaneous income, including recoveries and dividends, of INR 24.0 billion. 

 

Navigating its way through post-merger adjustments, the bank has been trying to get its loan growth to match the pace of deposit growth. However, deposits continue to outpace advances, making the bank the odd one out amongst its peers. Total deposits were at INR 27.64 trillion as of Jun. 30, up 16.2% on year. The low-cost current account savings account ratio of the bank was at 33.9% as of Jun. 30. 

 

Gross advances were INR 26.53 billion as of Jun. 30, an increase of 6.7% on year. Retail loans grew 8.1% to INR 15.22 trillion. Small and mid-market enterprise loans grew 17.1% and corporate and other wholesale loans grew 1.7%. Overseas advances constituted 1.7% of total advances. "The bank's credit performance across all segments continues to remain steady, in a credit environment that remains benign," the bank said in a release. 

 

The bank said it considered this as an opportune stage to enhance its floating provisions, which are not specific to any portfolio, nor meant for any specific anticipated risks, but act as a countercyclical buffer for making the balance sheet more resilient. It made floating provisions of INR 90.0 billion, and additional contingent provisions of INR 17.0 billion during the quarter. Due to this prudent provision, provisions and contingencies for the quarter ended June were at INR 144.4 billion. 

 

The liquidity coverage ratio of the bank was at 124% as of Jun. 30. The bank saw a dip in the cost of funds and yield on assets. Cost of funds for Apr-Jun fell to 4.8% from 4.9% a quarter ago. Yield on assets fell to 8.1% from 8.3% in the previous quarter. 

 

In terms of asset quality, gross non-performing assets were at 1.40% of gross advances as on Jun. 30 and net non-performing assets were at 0.47% of net advances. The credit cost of the bank improved to 56 basis points in the latest quarter, down from 48 bps a quarter ago. Slippages of the bank rose to INR 90 billion in Apr-Jun, up from INR 75 billion in the previous quarter. Recoveries and upgrades of the bank fell to INR 42 billion from INR 50 billion a quarter ago. The bank saw write-offs to the tune of INR 30 billion in the June quarter, compared to INR 33 billion a quarter ago. 

 

The board of the bank declared a special interim dividend of INR 5 per share. The board also approved the issuance of 1:1 bonus shares. The bank's total capital adequacy ratio as per Basel Ill guidelines was at 19.9% as of Jun. 30, as against a regulatory requirement of 11.9%. Shares of the bank Friday closed 1.5% lower at INR 1,957.40 on the National Stock Exchange.   End

 

Edited by Tanima Banerjee

 

 

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