“HDFC Bank’s Q3 Triumph: Net Profit Surges 34% and NII Grows 23.9% Defying Market Expectations”

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“HDFC Bank’s Q3 Financial Triumph: Net Profit Soars 34% to Rs 16,373 Crore, Meeting Market Expectations

In a stellar performance, HDFC Bank reported a standout 34% YoY surge in standalone net profit, reaching Rs 16,373 crore for the December quarter, aligning closely with Street projections. The bank’s robust financials were propelled by a noteworthy 23.9% YoY increase in Net Interest Income (NII), totaling Rs 28,470 crore compared to Rs 22,990 crore in the same quarter the previous year. The NII growth, though slightly below analyst estimates of 25%, reflects the bank’s resilience.

Pre-provision operating profit experienced a substantial 24.3% surge, touching around Rs 23,650 crore. However, provisions for the quarter witnessed an increase to about Rs 4,220 crore from Rs 2,810 crore in the year-ago quarter. HDFC Bank maintained a solid core Net Interest Margin (NIM) at 3.4% on total assets and 3.6% based on interest-earning assets.

HDFC Bank

Gross non-performing assets decreased to 1.26% of gross advances as of December 31, 2023, exhibiting the bank’s commitment to asset quality. Meanwhile, net non-performing assets were at 0.31% of net advances.

Non-interest revenue for the quarter reached approximately Rs 11,140 crore, showcasing a substantial growth from Rs 8,500 crore in the corresponding quarter of 2022. HDFC Bank’s diversified income streams include robust performance in fees & commissions, foreign exchange & derivatives revenue, and net trading and mark-to-market gain.

Operating expenses for the quarter were up by 28.1%, totaling Rs 15,960 crore, with a cost-to-income ratio of 40.3%. Despite the rise in expenses, the bank remains well-capitalized, with a Total Capital Adequacy Ratio (CAR) of 18.4% as per Basel II guidelines.

The bank’s extensive distribution network expanded to 8,091 branches and 20,688 ATMs across 3,872 cities/towns as of December 31, 2023, reflecting an ongoing commitment to serving diverse regions. Additionally, HDFC Bank highlighted its social impact, with 52% of its branches located in semi-urban and rural areas, reinforcing financial inclusivity.

The remarkable growth in domestic retail loans by 111.1%, coupled with robust performances in commercial, rural banking loans, and corporate and other wholesale loans, underscores HDFC Bank’s strategic lending focus. Overseas advances constitute a commendable 1.7% of total advances, contributing to the bank’s global footprint.

HDFC Bank’s Q3 results position it as a financial powerhouse, navigating challenges while reinforcing its commitment to delivering robust financial performance and contributing to India’s economic growth.”

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