HDFC Bank Q1 Review - Moderate NII Growth, Elevated Slippages; Recovery In The Offing: ICICI Securities

A customer wearing a protective mask approaches a HDFC Bank Ltd. mobile ATM van in a residential neighborhood of Mumbai. (Photographer: Dhiraj Singh/Bloomberg)

HDFC Bank Q1 Review - Moderate NII Growth, Elevated Slippages; Recovery In The Offing: ICICI Securities

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Securities Report

HDFC Bank Ltd.’s decadal low net interest income growth at 9% YoY in Q1 FY22 dragged earnings growth below expectations at 16% (against past six-year average of 18-20%).

Net interest margins (at 4.1%) settled at the lower end of the guided range.

HDFC Bank's slippages, amid second Covid-19 wave disruption, too were elevated at 2.54%, though partially offset by sale of non performing assets (Rs 18 billion) and write-offs (Rs 31 billion).

Gross non performing assets rose only marginally to 1.47% (from 1.32% in FY21) and credit cost was contained at 1.7%. Stage-III assets for its subsidiary, HDB Financial Services Ltd., almost doubled.

Click on the attachment to read the full report:

ICICI Securities HDFC Bank Q1FY22 Results Update.pdf

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