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HDFC Bank Q2: Net Profit Soars 51% to Rs 15.98B

Unveiling HDFC Bank’s Q2 Financial Results: Key Highlights

HDFC Bank, India’s largest private sector lender, announced its financial results for the second quarter of fiscal year 2024 on Monday, October 16, 2023. This marks HDFC Bank inaugural quarterly financial report following the merger with Housing Development Finance Corporation (HDFC) effective from July 1.

Impressive Growth in Net Profit and Net Interest Income

In the quarter ending September 2023, HDFC Bank reported a staggering 51% surge in its standalone net profit, reaching a total of INR 15,976 crores. This marks a significant increase from the INR 10,606 crores earned in the corresponding period last year.

Steady Rise in Standalone Revenues

The bank’s standalone revenue witnessed a notable uptick, soaring to INR 38,093 crores in Q2FY24, a 33% increase from the INR 28,617 crores reported in Q2FY23.

Robust Asset Quality

As of September 30, 2023, the Gross Non-Performing Assets (NPA) stood at 1.34%, a slight decline from 1.41% reported on June 30, 2023, and a marginal increase from 1.23% on September 30, 2022. The Net NPA was at 0.35% by September 30, 2023.

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Market Performance

On Monday, HDFC Bank shares on the Bombay Stock Exchange (BSE) dipped by 0.5%, closing at INR 1,529.5.

Mumbai’s Leading Lender

The net interest income of the Mumbai-based lender saw an impressive 30% surge in Q2FY24, reaching INR 27,385 crores, up from INR 21,021 crores in Q2FY23. The net interest margin for the quarter was 3.65% on total assets and 3.85% on interest-earning assets.

Provisions and Contingent Expenditures

For the quarter ending September, provisions and contingent expenditures amounted to INR 2,904 crores, a decrease from INR 3,240 crores during the same period last year.

Growth in CASA Deposits

The bank saw a commendable growth of 7.6% in its Current and Savings Account (CASA) deposits, with Savings Account deposits amounting to INR 5,69,956 crores and Current Account deposits at INR 2,47,749 crores.

Insights from the CFO

HDFC Bank Chief Financial Officer, Srinivasan Vaidyanathan, mentioned during a media conference call that post-merger, the margin would stabilize between 3.6% to 3.7%, factoring in the additional liquidity and merger-related costs. He noted a loss of 30-35 basis points due to the pre-merger excess liquidity.

Vaidyanathan refrained from providing specific margin projections for the upcoming quarters.

Summing Up HDFC Bank’s Q2 Results

In summary, HDFC Bank Q2FY24 results reflect robust growth across various financial parameters, with substantial increases in net profit, standalone revenue, and CASA deposits. Despite the challenges posed by the merger, the bank maintains a strong position in the private banking sector.

FAQ

  • Q: What were the key highlights of HDFC Bank Q2 financial results?
    • The Q2 results unveiled a remarkable 51% increase in standalone net profit, reaching INR 15,976 crores. Additionally, there was a substantial surge in standalone revenue and growth in CASA deposits.
  • Q: How did HDFC Bank standalone revenues perform in Q2FY24 compared to the previous year?
    • In Q2FY24, HDFC Bank standalone revenues witnessed a notable increase, reaching INR 38,093 crores, marking a 33% rise from the INR 28,617 crores reported in Q2FY23.
  • Q: What were the provisions and contingent expenditures for the quarter ending September?
    • For the quarter ending September, HDFC Bank recorded provisions and contingent expenditures amounting to INR 2,904 crores, showing a decrease from INR 3,240 crores during the same period last year.
  • Q: How did HDFC Bank net interest income and margin perform in Q2FY24?
    • In Q2FY24, HDFC Bank net interest income saw an impressive 30% surge, reaching INR 27,385 crores. The net interest margin was reported at 3.65% on total assets and 3.85% on interest-earning assets.
  • Q: What was the market performance of HDFC Bank shares after the Q2 results announcement?
    • Following the Q2 results announcement, HDFC Bank shares on the Bombay Stock Exchange (BSE) experienced a 0.5% decrease, closing at INR 1,529.5.
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