HDFC Bank's Q1 non interest income likely to grow 20%+

Private sector lender HDFC Bank will announce its first quarter earnings today. Analysts on average expect its profit after tax is likely to increase by whopping 30% year-on-year to Rs 1,411 crore for the quarter ended June 2012, according to CNBC-TV18 estimates.

Net interest income is expected to go up by 21% to Rs 3,444 crore in the first quarter of FY13 from Rs 2,848 crore in a year ago period.

Net interest income and profit after tax' growth will sustain at the average level of 20% & 30%, respectively

Loan growth is likely to sustain 20% (average), which will be led by the retail book as against corporate. In Q4, loan growth was at 22% year-on-year & 0.6% quarter-on-quarter whereas deposit growth was healthy at 18%.

It was skewed towards the retail segment in Q4 that expanded 33% YoY. Loan mix continued to shift towards retail (54% of the book in Q4 as against 51% in Q3)

Corporate loan book was down 6% QoQ in the quarter ended March 2012.

Margins are expected to be stable and steady between 4 to 4.2% in the June quarter, which has been sustaining at these levels in FY12. Net interest margins were up by 10 basis points QoQ at 4.2% in Q4.

Non interest income is likely to grow 20% plus led by fee income (that expected to be 20% YoY) and positive trading gains (as against loss of Rs 40 crore in a year ago period). In the March quarter, non interest income was up by 19% to Rs 1,492 crore, with fee income rose by 24% YoY to Rs 1,237 crore.

Healthy asset quality trends will continue in the June quarter too. No negative surprises are expected. In Q4 FY12, gross non-performing asset (NPA) was flat at 1.02% and net NPA at 0.2%. Gross NPA was down 1% QoQ to Rs 1,999 crore, but rose 18% YoY. Net NPA went down 11.5% QoQ to Rs 352 crore, but jumped 19% YoY. 

Total restructured assets were 0.4% of loan book in the January-March quarter of 2012.

Provisions are expected to be at Rs 330 crore in the June quarter, a decline of 26% YoY while an increase 11% QoQ. In Q4, provisions fell 9% QoQ and 31% YoY to Rs 298 crore.

CASA ratio is likely to be remained at 45% plus in the April-June quarter of 2012. In the previous quarter, CASA had improved to 48.4% versus 47.7% due to a 16% growth in savings accounts.