HDFC Bank net profit jumps 29 pc on core income growth, trading gains

Core income growth and trading gains helped HDFC Bank post a 29 per cent jump in consolidated net profit for the June quarter at Rs 12,370 crore.

On a standalone basis, the largest private sector lender reported a 30 per cent jump in net profit for April-June period at Rs 11,952 crore.

This is one of the fastest profit growths reported by the city-headquartered lender, which recently completed merger of its mortgage financier parent HDFC into itself with effect from July 1 onwards.

A few years ago, it had a multi-quarter run of having a 30 per cent jump in net profits till the slowing economy tempered it to around 20 per cent levels.

HDFC Bank, however, showed a decline in profits when compared to the preceding March quarter.

In the reporting quarter, core Net Interest Income (NII) grew 21 per cent to Rs 23,599 crore, helped by 15.8 per cent advances growth, while the Net Interest Margin expanded to 4.1 per cent on the overall assets.

The other income came at Rs 9,230 crore, but it was the trading gains of Rs 552 crore as against a loss of Rs 1,077 crore in the year-ago period, which helped the bottom line.

It's operating expenses grew 33.9 per cent to Rs 14,057 crore.

The provisions and contingencies for the reporting quarter were at Rs 2,860 crore, as against Rs 3,122 crore in the year-ago period, and also helped the profit growth.

The gross non-performing assets ratio improved to 1.17 per cent when compared to 1.28 per cent in the year-ago period, but was marginally higher when compared with the 1.12 per cent in the preceding March quarter-end.

The share of the low-cost current and saving account deposits stood at 42 per cent as on June 30. Its overall branch strength was 7,860, with 52 per cent of them being in semi-urban and rural areas, and the rest in urban pockets.

From a loan book composition perspective, retail assets accounted for 38 per cent of the Rs 16.29 lakh crore loan book, commercial and rural banking were at 38 per cent and corporate advances were 24 per cent.

HDFC Bank's overall capital adequacy stood at 18.9 per cent as of June 30, 2023 and was well above regulatory requirements.

The overall number of employees grew to 1,81,725 at the end of June.

Among its subsidiaries, HDB Financial Services' net profit grew to Rs 567 crore from Rs 441 crore and HDFC Securities' net was flat at Rs 189 crore.

In a note, analysts at domestic brokerage Stoxbox said the overall results were decent but there was some visibility of weak NII and asset quality.

The HDFC Bank scrip was trading 2.12 per cent up at Rs 1,680 a piece on the BSE at 1521 hrs, as against gains of 0.86 per cent on the benchmark.