Mumbai: Helped by a surge in interest and fees income, HDFC Bank Ltd reported a 44.6% growth in net profit to Rs464.4 crore for the fiscal first quarter ended 30 June.
The latest quarter results are not comparable to year-ago numbers as they include operations of Centurion Bank of Punjab Ltd, which HDFC Bank acquired during the period.
HDFC’s net interest income increased by 74.9% to Rs1,723.5 crore, driven by average asset growth of 68%. Its net interest margin dipped to 4.1% from 4.4% in the fourth quarter ended March. Other income for the quarter rose to Rs593.4 crore from Rs572.5 crore in the year-ago period.
Growth story: An HDFC Bank branch in New Delhi. The bank’s net interest income rose 75% to Rs1,725 crore on average asset growth of 68%. Photograph: Madhu Kapparath / Mint
Fees and commission were the main contributor to other income for the quarter and increased by 37.3% to Rs511.2 crore. The other components of other income were foreign exchange/derivatives revenues of Rs157.4 crore, up fromRs146.5 crore, and a loss on revaluation and sale of investments of Rs77.6 crore, compared with a profit of Rs52.6 crore in the year-ago quarter.
HDFC’s operating expenses were up sharply to Rs1,289.38 crore from Rs774.38 crore.
“The gross, non-performing assets for the bank, post-consolidation, at Rs1,500 crore has expanded by Rs500 crore compared to HDFC Bank stand-alone in the fourth quarter of financial year 2008 (which) was at Rs906 crore. This is relatively lower than expectations. Any write-off, which would not be reflected in the performance for the first quarter needs to be checked upon,” says Shashin Upadhyay, research analyst at Alchemy Share and Stock Brokers Private Ltd.
HDFC’s deposit base grew 60.4% to Rs1,30,918 crore from the year-ago quarter.
With savings account deposits of Rs31,853 crore and current account deposits at Rs26,866 crore, the combined accounts mix for the merged entity was around 44.9% of total deposits. Net advances were Rs96,797 crore, an increase of 79.8%.
The bank’s capital adequacy ratio stood at 12.2% against 13.1%. Provisions and contingencies for the quarter were Rs344.5 crore, up fromRs307.1 crore for the year-ago period, comprising primarily of specific provisions for non-performing assets and general provisions for standard assets of Rs324.4 crore, up from Rs299.7 crore.
Gross non-performing assets to advances increased to 1.5% against 1.3% and net non-performing assets to advances increased to 0.5% from 0.4%.
HDFC shares fell 0.01% to Rs1,127.05 each on the Bombay Stock Exchange on Monday.