HDFC Bank’s Robust Q3 Performance: Net Profit Soars 33.5% to INR 16,372 Crore; Asset Quality Remains Stable

HDFC Bank, a leading player in the Indian banking sector, has announced its impressive financial results for the third quarter of the fiscal year 2023-24, showcasing a substantial growth trajectory. Here’s a comprehensive overview of the key highlights from the Q3 report:

1. Stellar Net Profit Growth:

  • The bank reported a stellar net profit of INR 16,372 crore for the October-December quarter, marking a remarkable surge of 33.5% from the previous year’s figure of INR 12,259 crore.

2. Net Interest Income (NII) Surge:

  • HDFC Bank’s Net Interest Income (NII) witnessed a robust increase, reaching INR 28,470 crore, reflecting a noteworthy growth of 23.9% compared to the same quarter in the previous fiscal year.

3. Asset Quality Stability:

  • Despite a marginal uptick, the gross non-performing assets (NPA) stood at 1.26%, indicating a stable asset quality, up from 1.23% reported in the corresponding period last year.
  • The net NPA for the quarter was reported at 0.31%, showcasing an improvement from 0.33% in the previous year.

4. Provisional Upsurge:

  • The bank’s provisions rose to INR 4,216 crore, reflecting a significant increase of 50%. Srinivasan Vaidyanathan, CFO of HDFC Bank, noted that this figure includes contingent provisions of approximately INR 1,212 crore related to investments in alternative investment funds.

5. Robust Loan Portfolio:

  • Total advances of the bank witnessed an impressive growth of 62.4%, reaching INR 24.69 lakh crore.
  • Noteworthy growth was observed across various segments, with domestic retail loans soaring by 111%, commercial and rural loans growing by 31.4%, and corporate and wholesale loans (excluding non-individual loans of eHDFC Ltd.) expanding by 11.2%.

6. Deposits Surge:

  • Total deposits for the October-December FY24 quarter surged by 27.7%, reaching INR 28.47 lakh crore, compared to INR 22.29 lakh crore in the corresponding quarter last year.
  • Current account and savings account deposits grew by 9.5%, with savings account deposits at INR 5.79 lakh crore and current account deposits at INR 2.58 lakh crore.

7. Market Sentiment:

  • HDFC Bank’s shares closed at INR 1678.95 apiece on the BSE, reflecting a 0.42% increase.

8. Analysts’ Projections:

  • Analysts had estimated HDFC Bank’s net profit for Oct-Dec at INR 156.24 billion, making the actual reported figure of INR 163.73 billion slightly surpass expectations.

9. Cumulative Fiscal Performance:

  • For the period April-December 2023, HDFC Bank reported a robust net profit of INR 443.00 billion, compared to INR 320.61 billion for the same period in the previous fiscal.
  • The total income for the same period surged to INR 2.179 trillion, reflecting a substantial increase from INR 1.389 trillion in the corresponding period last year.

10. Basel III Capital Adequacy Ratio:

  • HDFC Bank’s Basel III capital adequacy ratio stood strong at 18.39% as of December 31, 2023, underscoring the bank’s robust financial health.

In conclusion, HDFC Bank’s Q3 results underscore its resilience and ability to navigate challenging economic conditions while maintaining a robust financial position. The bank’s strategic focus on diverse loan portfolios and prudent financial management has positioned it for sustained growth in the dynamic banking landscape.

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