HDFC Q4 Profit Jumps, Aided By One-Time Gain From Sale Of Subsidiaries

Housing Development Finance Corporation Ltd.’s net profit surpassed analyst estimates for the quarter ended March, aided by a one-time gain from the sale of its subsidiaries.

Net profit rose 39.2 percent to Rs 2,846.2 crore as compared with the same quarter last year, the lender said in its filings with the stock exchanges. This was ahead of the Bloomberg consensus estimate of Rs 2,551 crore. Revenue increased 10.3 percent to Rs 9,327.8 crore year-on-year. The bottom line was aided by a pre-tax gain of Rs 265.46 crore during the fourth quarter as HDFC sold 100 percent share capital in wholly owned subsidiaries HDFC Developers Ltd. and HDFC Realty Ltd. to Quikr India Pvt.

Net interest income, the core income of the bank, rose 12 percent year-on-year to Rs 3,617 crore. The net interest margin rose 4 percent in the same period.

Gross non-performing loan ratio stood at 1.11 percent of the total advances versus 1.15 percent in the previous quarter, HDFC said in a separate press release. Net bad loan ratio in the individual loan portfolio was 0.64 percent while that of the non-industrial portfolio was 2.18 percent. Provisions against bad loans stood at Rs 180 crore as compared with Rs 95 crore in the previous quarter. Of this, Rs 80 crore was a one-time provision for the contingencies account.

Loan Book Highlights

• The total loan book stood at Rs 3.59 lakh crore as of March 31, 2018.
• Overall loan book grew 18 percent year-on-year in terms of assets under management.
• Individual home loans sold as on March 31 stood at Rs 39,364 crore.
• The lender recorded a 26 percent growth in individual loans after adding back loans sold in the preceding 12 months.
• The non-individual loan book grew 17 percent.

The lender’s board approved raising up to Rs 85,000 crore via non-convertible debentures on private placement basis, according to its exchange filing.

Shares of HDFC extended gains and rose as much as 2.1 percent to Rs 1,892.05 apiece after the earnings announcement. The stock rose 6.7 percent during January-March period, compared to a 3.2 percent decline in the Sensex.