HDFC Q3 profit jumps 13% YoY to Rs 3,691 crore, AUM grows 13% to Rs 7 trn

HDFC's Q3 net profit beat Street estimates which had pegged PAT around Rs 3,730 crore

Private mortgage lender HDFC (Housing Development Finance Corporation), on Thursday, reported standalone net profit of Rs 3,691 crore for the October-December quarter (Q3) of financial year 2022-23 (FY23). This was 13.2 per cent higher than Rs 3,261 crore profit reported in the year-ago period.

HDFC had net profit of Rs 4,454 crore in the September quarter of the current financial year (Q2FY23). The profit before tax for the quarter ended December 31, 2022 stood at Rs 4,612 crore compared to Rs 4,048 crore in the corresponding quarter of the previous year.

The bottomline beat Street estimates which had pegged PAT around Rs 3,730 crore. 

For the first nine months of FY23, HDFC's profit before tax stood at Rs 14,616 crore compared to Rs 12,624 crore in the corresponding period of the previous year. After providing Rs 2,802 crore for tax, the reported profit after tax stood at Rs 11,814 crore compared to Rs 10,042 crore in the previous year, representing a growth of 18 per cent.

Operationally, the housing financier's net interest income surged to Rs 4,840 crore during the period under study, up from Rs 4,284 crore year-on-year, and Rs 4,639 crore quarter-on-quarter. Net interest margin (NIM) was at 3.5 per cent for April-December period.

HDFC said its assets under management (AUM) at the end of the December quarter stood at Rs 7.01 trillion as against Rs 6.19 trillion in the previous year. Of this, individual loans comprised 82 per cent of the AUM.

"On an AUM basis, the growth in the individual loan book was 18 per cent, and growth in the total loan book on an AUM basis was 13 per cent. During the quarter ended December 31, 2022, the Corporation assigned loans amounting to Rs 8,892 crore to HDFC Bank," it said in its exchange filing.

During the nine-months ended December 31, 2022, individual approvals and disbursements grew by 21 per cent, and 23 per cent, respectively compared to the corresponding period in the previous year, it added.

Asset quality
The mortgage lender's asset quality improved during the said quarter with the gross non-performing loans (GNPLs) at the end of Q3 falling to Rs 8,880 crore. This is equivalent to 1.49 per cent of the portfolio, down from 2.32 per cent YoY.

The gross individual NPLs stood at 0.86 per cent as against 1.44 per cent last year, while the gross non-performing non-individual loans stood at 3.89 per cent vs 5.04 per cent YoY. 

"The Corporation carries a total provision of Rs 13,274 crore. The provisions carried as a percentage of the Exposure at Default (EAD) is equivalent to 2.21 per cent. Further, the collection efficiency for individual loans on a cumulative basis stood at 99 per cent during the nine-months ended December 31, 2022," HDFC said. 

HDFC said, for the nine-months ended December 31, 2022, the cost to income ratio stood at 9.5 per cent, while capital adequacy ratio stood at 23.7 per cent at the end of Q3FY23, of which Tier I capital was 23.2 per cent, and Tier II capital was 0.5 per cent.

On the bourses, shares of HDFC were trading 2 per cent lower at Rs 2,604 per share as against an unchanged S&P BSE Sensex.