HDFC Q4 profit falls 22% to Rs 2044 cr, NII soars 26%; provisions decline 73%

Country's largest housing finance company Housing Development Finance Corporation (HDFC) said its standalone profit during January-March quarter fell 21.6 percent to Rs 2,044.20 crore compared with Rs 2,607.05 crore in same quarter last fiscal. The same grew 20.16 percent sequentially.

The profit in Q4FY16 included gain (Rs 1,513.41 crore) on sale of stake by the company in HDFC Standard Life Insurance Company to Standard Life Mauritius Holdings.

Income from operations jumped 10 percent year-on-year (up 4 percent quarter-on-quarter) to Rs 8,453.41 crore in January-March quarter.

The fourth quarter net interest income surpassed analysts' expectations, growing 26.5 percent to Rs 3,122.6 crore compared with Rs 2,469.3 crore in same quarter previous fiscal.

Net interest margin at the end of FY17 remained flat at 4.1 percent YoY, HDFC said, adding total loan book stood at Rs 2.96 lakh crore as on March 31, 2017, up 14.4 percent YoY.

Individual loan book grew by 13.6 percent year-on-year to Rs 2.04 lakh crore and non-individual loan book increased 16.1 percent to Rs 92,039 crore.

Provisions during the quarter increased 26.5 percent sequentially to Rs 148 crore but declined sharply by 72.8 percent compared with Rs 545 crore in corresponding quarter of last fiscal.

Profit was expected at Rs 2,003.2 crore and net interest income at Rs 2,846.4 crore for the quarter, according to average of estimates of analysts polled by CNBC-TV18.

While addressing press conference, Keki Mistry, Vice Chairman and CEO of HDFC said the housing finance firm sold loans worth Rs 5,625 crore in Q4 to banks including to HDFC Bank.

Cost-to-income ratio for the quarter stood at 5.8 percent, which increased compared with 3.9 percent in year-ago period but declined compared with 7.5 percent previous quarter.

Asset quality remained stable during the quarter. Gross non-performing assets as a percentage of gross advances declined to 0.79 percent from 0.81 percent on sequential basis. On absolute basis, gross NPAs increased 1.6 percent QoQ to Rs 2,378 crore in Q4.

Growth in asset under management was at 16.1 percent YoY, which was ahead of analysts' estimates of 15 percent.

HDFC said the board of directors recommended a final dividend of Rs 15 per share for the financial year 2016-17, which, if approved, will be paid on July 27.

The board also granted its in-principle approval for issuance of rupee denominated bonds to overseas investors up to an amount not exceeding Rs 5,000 crore, it added.

At 14:49 hours IST, the stock price was quoting at Rs 1,568.00, down Rs 3.05, or 0.19 percent on the BSE.