HDFC Q4 Results: Net Profit Jumps 42% On Higher Interest Income
Housing Development Finance Corp.’s quarterly profit rose, aided by higher interest income.
The mortgage financier’s net profit increased 42% year-on-year to Rs 3,180 crore in the quarter ended March, according to an exchange filing. That compares with the Rs 2,928-crore consensus estimate of analysts tracked by Bloomberg.
Its net interest income, or core income, rose 14% year-on-year to Rs 4,065 crore, against the Rs 4,206-crore forecast.
Asset Quality & Provisions
Asset quality for the housing finance company, however, worsened slightly, with gross non-performing asset ratio at 1.98% against 1.91% as of December. The third-quarter asset quality figure includes accounts which were not classified as non-performing because of a Supreme Court order barring lenders from downgrading accounts.
The non-performing loans of the individual portfolio stood at 0.99%, while that of the non-individual portfolio stood at 4.77%.
The company said it restructured loans worth Rs 3,687 crore under the Reserve Bank of India’s one-time restructuring scheme. This included 3,775 retail loans worth Rs 923.43 crore and eight corporate loan accounts belonging to a corporate entity worth Rs 2,763.65 crore. Against these restructured loans, HDFC held provisions worth Rs 368.78 crore.
According to regulatory norms, HDFC is expected to carry provisions worth Rs 5,491 crore, in comparison it currently holds provisions worth Rs 13,025 crore, it said.
“At this juncture, there continues to be a great deal of uncertainty on the duration and intensity of the second [Covid-19] wave and the resultant impact it may have on the corporation and the overall economy,” the company said in the statement.
- Loans on an asset under management basis rose 10.3% from a year ago to Rs 5.7 lakh crore.
- Loans to individuals rose 12% year-on-year, while non-individual loans reported a 4% growth as on March 31.
- Disbursements in the fourth quarter, according to the company, rose 60% over the year earlier.
“March 2021 witnessed the highest levels in terms individual receipts, approvals and disbursements. Growth in home loans was seen in both, the affordable housing segment as well as high-end properties,” HDFC said in a statement.
HDFC's board approved dividend worth Rs 23 per share with a face value of Rs 2 on May 7. The board also approved fundraising through non-convertible debentures or any hybrid instrument worth up to Rs 1.25 lakh crore on a private placement basis.
Meanwhile, Keki Mistry, vice chairman and managing director of the home financier, was reappointed for another three years, subject to shareholder approvals.
Shares of HDFC rose as much as 3.2% to Rs 2,507 apiece after the results announcement compared with the NSE Nifty 50 index's 0.72% gain.
(Corrects an earlier version that misstated provisions held against restructured loans.)