HDFC Bank Q2 FY25 Results: Net Profit Rises 5% to Rs 16,821 Crore, Beating Estimates

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HDFC Bank Q2 FY25 Results: Net Profit Rises 5% to Rs 16,821 Crore, Beating Estimates

HDFC Bank's Q2 FY25 net profit beat Street expectations, while Net Interest Income fell marginally short of estimates. Gross NPA at the end of the quarter expanded a little to 1.36 percent.

October 19th, 2024 News

HDFC Bank, India's largest private sector bank, reported a 5 percent year-on-year (YoY) increase in its net profit for the second quarter of FY25, reaching Rs 16,821 crore. This surpassed the Street's expectations, as the average estimate from seven brokerages had pegged the figure at Rs 16,570 crore.

Key Highlights of HDFC Bank's Q2 FY25 Results:

Net Profit: Rs 16,821 crore, up 5% YoY, exceeding market expectations of Rs 16,570 crore.
Net Interest Income (NII): Rs 30,114 crore, up 10% YoY.
Other Income: Non-interest revenue rose to Rs 11,480 crore from Rs 10,710 crore a year ago.
Gross NPAs: Slight increase to 1.36% compared to 1.33% in the previous quarter.
Advances: Gross advances rose by 7% YoY to Rs 25.19 lakh crore.
Deposits: Total deposits grew by 15.1% YoY, reaching Rs 25 lakh crore.

Financial Performance

HDFC Bank’s net interest income (NII), the difference between interest earned and interest expended, rose by 10 percent YoY to Rs 30,114 crore. This was slightly below the brokerage poll estimate of Rs 30,306 crore. The bank’s core net interest margin (NIM) stood at 3.46 percent of total assets and 3.65 percent on interest-earning assets. Non-interest income (other income) saw a 7.2 percent rise YoY, coming in at Rs 11,480 crore.

Asset Quality

The lender’s gross non-performing assets (GNPA) stood at 1.36 percent as of September 30, 2024, up slightly from 1.33 percent at the end of the previous quarter. Net NPAs rose to 0.41 percent from 0.39 percent. In absolute terms, gross NPAs increased to Rs 34,251 crore, compared to Rs 33,026 crore in the preceding quarter, while net NPAs rose to Rs 10,309 crore from Rs 9,508 crore.

Provisions for the quarter stood at Rs 2,701 crore, marking a 4 percent increase from the previous quarter’s Rs 2,602 crore.

Deposits and CASA Ratio

HDFC Bank's total deposits grew by 15.1 percent YoY to Rs 25 lakh crore during the July-September quarter. The current and savings account (CASA) deposits increased by 8.1 percent YoY, with savings deposits amounting to Rs 6.08 lakh crore and current account deposits standing at Rs 2.75 lakh crore. Time deposits saw a robust growth of 19.3 percent, reaching Rs 16.17 lakh crore.

The bank’s CASA deposits comprised 35.3 percent of total deposits as of September 30, 2024.

Advances and Loans

Gross advances increased by 7 percent YoY to Rs 25.19 lakh crore. Retail loans grew by 11.3 percent, while the commercial and retail banking segment saw a 17.4 percent growth. On the other hand, corporate and wholesale loans declined by 12 percent YoY. Overseas advances made up 1.7 percent of the bank's total advances.

On an average basis, the bank's advances under management were Rs 25.64 lakh crore during the July-September quarter, compared to Rs 23.27 lakh crore in the same quarter last year.

Stock Performance

Following the earnings announcement, shares of HDFC Bank closed at Rs 1,681.15 on October 18, 2024, up by 0.47 percent on the BSE.

Conclusion

HDFC Bank's Q2 FY25 results reflect steady growth in profitability and deposits, despite marginal increases in NPAs. The bank continues to maintain a strong position with robust retail and commercial loan growth, even as corporate loans show a decline. These results showcase HDFC Bank’s resilience in an evolving economic landscape.