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Informist, Thursday, Apr. 16, 2026

 

By Krity Ambey

 

NEW DELHI – HDFC Bank Ltd. is expected to report a modest growth in profit for the March quarter as the lender's net interest income is likely to moderate. Brokerages have flagged traction on deposits and credit-deposit ratio as key areas to monitor. Analysts also await the bank's commentary on developments following former part-time chairman Atanu Chakraborty's abrupt resignation in March, citing differences over "values and ethics". 

 

India's largest private-sector bank is seen reporting a year-on-year rise of nearly 9% in net profit for the March quarter to around INR 191.13 billion, according to the average of estimates from 13 brokerages. The net profit estimates range from INR 186.40 billion by YES Securities (India) Ltd. to INR 201.92 billion by Prabhudas Lilladher Pvt. Ltd.

 

Sequentially, the lender's bottom line is likely to rise a little over 2% in the March quarter from INR 186.54 billion, if the profit aligns with the consensus estimate. But it is worth noting that the bank had incurred a one-time cost of INR 8 billion in the December quarter due to the new labour codes notified in November. If not for this cost, the bank's profit for the quarter would have been INR 194.54 billion. Compared to the December quarter profit without extraordinary items, the consensus estimate for the March quarter is down nearly 2%. 

 

The bank's net interest income for the March quarter is likely to grow 5% on year to INR 336.88 billion, according to the average of estimates from 13 brokerages. The projections range from INR 328.77 billion estimated by JM Financial Institutional Securities Pvt. Ltd. to INR 344.02 billion estimated by the brokerage Prabhudas Lilladher. Sequentially, the net interest income is likely to be up a little over 3%.

 

Brokerages expect HDFC Bank's credit-deposit ratio to ease in the March quarter, with Kotak Securities Ltd. estimating it around 95%, compared to 96.5% in the corresponding quarter a year ago and 98.7% in the December quarter. Motilal Oswal Financial Services Ltd. has projected gradual normalisation of HDFC Bank's credit-deposit ratio over the medium term to around 94% by the end of the financial year 2027-28 (Apr-Mar).

 

The bank had set itself a target to lower the credit-deposit ratio to the range of 90–96% by March. It aims to further cut the ratio to 85-90% by the end of FY27. HDFC Bank, which will detail its earnings for the March quarter Saturday, has been witnessing a credit-deposit ratio of over 95% since its merger with parent Housing Development Finance Corp. Ltd. in 2023. The lender is counting on its deposits growing faster than the average deposit growth for the banking system in FY27 to help it bring the ratio to 85-90%. Provisional data show HDFC Bank's deposits grew 14.4% on year to INR 31.06 trillion as of Mar. 31 and gross advances rose 12% on year to INR 29.6 trillion.    

 

The bank's net interest margin is expected to remain broadly stable, with brokerage views mixed between marginal expansion and slight compression. While SMIFS Ltd. expects support to margin from deposit repricing and lower funding costs, Nomura Equity Research sees pressure from the transmission of repo rate cuts. HDFC Bank had reported a net interest margin of 3.35% in the December quarter.

 

Asset quality is also expected to remain stable, with slippages likely to moderate sequentially due to seasonality. The bank's non-performing asset ratios, as of Dec. 31, were unchanged sequentially, with the gross non-performing asset ratio at 1.24% and the net non-performing asset ratio at 0.42%. Its provisions are likely to fall sequentially from INR 28.38 billion in the December quarter, according to analysts. HDFC Bank had made provisions of INR 38.1 billion in the March quarter of FY25.

 

All 17 research reports on the bank available with Informist have a "buy" recommendation on the stock, with an average target price of INR 1,111, nearly 40% higher than the current price. The shares, which have fallen 15% since the bank announced its December quarter earnings, closed 1.8% lower Thursday at INR 795.45 on the National Stock Exchange.

 

Following are the March quarter earnings estimates from 13 brokerages, in INR billion, for HDFC Bank in descending order of the estimate of net profit:

 

Brokerage	Net Interest Income	Net Profit
Prabhudas Lilladher Pvt. Ltd.	344.02	201.92
SMIFS Ltd.	341.00	195.00
Emkay Global Financial Services Ltd.	333.93	194.94
Kotak Securities Ltd.	338.02	193.66
Nuvama Wealth Management Ltd.	341.00	193.20
Motilal Oswal Financial Services Ltd.	336.61	191.98
Nomura Equity Research	334.00	189.00
Elara Securities (India) Pvt. Ltd.	337.35	188.75
Anand Rathi Share and Stock Brokers Ltd.	336.25	188.40
Equirus Securities Pvt. Ltd.	335.90	187.91
ICICI Securities Ltd.	334.29	186.95
JM Financial Institutional Securities Pvt. Ltd.	328.77	186.55
YES Securities (India) Ltd.	338.34	186.40
Average	336.88	191.13

 

End

 

Edited by Rajeev Pai

 

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