HDFC reports 22% jump in net profit in Q1, misses estimates; individual loans grow highest in 8 yrs

Shares of HDFC were trading 1% higher on Friday at Rs 2,360 per share. 

HDFC reports 22% jump in net profit in Q1, misses estimates; individual loans grow highest in 8 yrs
HDFC announced its quarterly results today.

Housing Development Finance Corporation (HDFC) reported a standalone net profit of Rs 3,669 crore in the April-June quarter, rising 22% on-year basis, missing analyst expectations. HDFC, the largest mortgage lender in the country reported a consolidated net profit of Rs 5,574 crore. HDFC said that during the April-June quarter, its individual loan disbursements grew by 66% over the corresponding quarter of the previous year. “The demand for home loans and the pipeline of loan applications continues to remain strong. Growth in home loans was seen in both, the middle-income segment as well as in high-end properties,” HDFC added. Shares of the company were trading 1% higher on Friday at Rs 2,360 per share. 

HDFC highlighted that it saw 66% growth in individual disbursements during the quarter under review. It further added that the quarter saw the highest percentage growth in individual loans on an AUM basis in the past 8 years. “The quarter ended June 30, 2022 entailed a volatile environment. Some of the financials of the current quarter are not directly comparable with that of the previous year,” HDFC added.

The net interest income (NII) for the fiscal first quarter stood at Rs 4,447 crore compared to Rs 4,125 crore in the previous year. “In Q1FY23, interest rate actions have had an immediate impact on borrowing costs, without a simultaneous transmission on the asset side,” HDFC said. The mortgage lender reported NIM of 3.4%. 

At the end of June, HDFC’s gross individual non-performing loans stood at 0.98% of the individual portfolio, while the gross non-performing non-individual loans stood at 4.44% of the non-individual portfolio. The gross NPLs as at June 30, 2022 stood at Rs 10,288 crore. This is equivalent to 1.78% of the portfolio. This marks an improvement compared to December 31, 2021 (the first time of reporting under the new norms), where the gross individual NPLs stood at 1.44% and the gross non-individual NPLs stood at 5.04% of the non-individual portfolio. Total NPLs as at June 30, 2022 has reduced to stand at 1.78% as against 2.32% as at December 31, 2021,” HDFC added.

HDFC also announced that its board has approved an investment of an amount not exceeding Rs 2,000 crore in the preferential issue of equity shares to be made by HDFC Life Insurance Company. 

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