HDFC, India?s largest home loan financing company, impressed the stock markets on Monday despite a 4.5% slide in its net earnings for the fourth quarter. Its profit after tax was down to Rs 733.37 crore from Rs 768.12 crore a year earlier.

The company, however, said its Q4 profit in 2007-08 was inflated by a one-time gain of Rs 202 crore from the sale of its 26% stake in HDFC General Insurance to Munich Re. Excluding the one-time gain, the net profit for the quarter would have been higher by 20%.

The stock was among the best performers on the National Stock Exchange, logging a rise of nearly 14% to Rs 1,965.05. ?It is a decent result?, said Akhilesh Singh, business head, wealth management & distribution services of Emkay Global Financial Services, adding, ?but it could have been slightly better. While its competition does bigger-ticket size, HDFC?s policy of smaller-ticket size and larger volumes have paid off and it could maintain the growth curve.?

The company has about 40% share of the home loan market by volume. SBI and ICICI make up another 25% each. Speaking with FE, Konrad

D?Souza, senior general manager (treasury), HDFC, was optimistic. ?In the current fiscal, we anticipate an 18 to 20% growth in our advances portfolio, as we believe the worst is over for the country?s real estate sector. We have no plans to sell our non-performing loans worth around Rs 700 crore as on March 31, 2009 to any asset reconstruction company. We will go for its recovery in the current fiscal.?

HDFC?s income (excluding profit on sale of investments and exceptional items) for the quarter rose by 36% to Rs 3,152.44 crore from Rs 2,317.67 crore a year earlier.

During the financial year 2008-09, HDFC?s total assets rose to Rs 96,994 crore compared with Rs 81,099 crore in the 2007-08, an increase of 20%. As on March 31, 2009, the loan book of HDFC stood at Rs 85,198 crore against Rs. 73,328 crore a year ago, a rise of 16%.

Loan approvals of HDFC during 2008-09 were worth Rs 49,166 crore against Rs 42,520 crore in the previous year, a growth of 16%. The spread on loans over the cost of borrowings stood at 2.21%.

Loan disbursements were worth Rs 39,650 crore versus Rs 32,875 crore, representing a growth of 21%.

Cumulative loan approvals and disbursements as on March 31, 2009 were at Rs 2,37,450 crore and Rs 1,91,806 crore, respectively. Gross non-performing loans amounted to Rs 701.55 crore. This is equivalent to 0.81% of the total loan portfolio and against 0.84% in the previous year.

In tune with the prudential norms stipulated by the National Housing Bank, HDFC is required to make a provision of Rs 319.40 crore towards non-performing assets and a general provision on outstanding standard non-housing loans. The balance in the provision for contingencies account stood at Rs 621.53 crore.

HDFC?s capital adequacy ratio stood at 15%. The board of HDFC has recommended a dividend of Rs 30 a share for the year ended March 31, 2009.