India's largest housing finance major Housing Development Finance Corporation (HDFC) on Monday reported a forecast beating 16% year-on-year jump in its fourth quarter net profit at Rs 1,326 crore aided by higher interest income. Net interest income (NII) or the difference between interest earned and paid out climbed nearly 24% to Rs 1,867 crore.
However, the profit on the sale of investments fell sharply to Rs 79 crore compared with Rs 134 crore recorded in the corresponding quarter of the previous year.
Net profit rose slightly at a higher pace of 17% y-o-y to Rs 4,123 crore for the year ended March 31, 2012. The company has proposed a dividend of Rs 11 per share.
Its loan book expanded 20% y-o-y to around Rs 1.41 lakh crore. The average size of individual loans stood at Rs 19.50 lakh as against Rs 18.60 lakh a year back. Consequently, total borrowing of the corporation too went up 21% y-o-y to Rs 1.39 lakh crore. This suggests an uptick in home business, at least for the HDFC.
The mortgage lender continues to maintain its asset quality. Gross non-performing asset ratio (NPA) ratio inched up to 0.74% at Rs 1,070 crore as against 0.77% a year ago.
"This is the twenty-ninth consecutive quarter end at which the percentage of non-performing loans have been lower than the corresponding quarter in the previous year," HDFC said in a release.
Due to change in provisioning norms by the National Housing Bank (NHB), the regulator for housing finance companies, the provisioning requirement has gone up for HDFC. It will have to carry provisions of Rs 1,402 crore inclusive of NPAs and general provisions on standard assets.
On consolidated basis, HDFC's life insurance and asset management business put up relatively poor performance in generating revenues. While the former fell by 6% y-o-y to Rs 10,448 crore, the latter came down marginally by 4% to Rs 760 crore.