Not only its PAT but also net interest income and pre-provision operating profit grew by nearly 23 percent each year-on-year.
HDFC Bank registered healthy earnings for January-March quarter, which were in line with Street expectations. Not only its PAT but also net interest income and pre-provision operating profit grew by nearly 23 percent each year-on-year.
The stock, an index heavyweight, underperformed its closest peer ICICI Bank. It gained more than 7 percent in last three months and 16 percent in three months while ICICI rallied 9 percent and 28 percent in same period, respectively.
Here are 10 key takeaways from its results:
After providing Rs 3,069.3 crore for taxation, the bank earned a net profit of Rs 5,885.1 crore in Q4, an increase of 22.6 percent over the quarter ended March 2018.
Net Interest Income
Net interest income (interest earned less interest expended) for the quarter ended March 2019 grew by 22.8 percent to Rs 13,089.5 crore YoY, driven by average asset growth of 19.8 percent and a core net interest margin for the quarter of 4.4 percent.
CNBC-TV18 poll estimates for profit were Rs 5,805.3 crore and net interest income Rs 13,043.3 crore for Q4.
Gross non-performing assets were at 1.36 percent of gross advances as on March 2019, against 1.38 percent as on December 2018 and 1.30 percent as on March 2018.
Net non-performing assets were at 0.4 percent of net advances as on March 2019.
Total provisions (comprising specific provisions, general provisions and floating provisions) were 117 percent of the gross non-performing loans as on March 2019.
Provisions and contingencies for the quarter ended March 2019 were Rs 1,889.2 crore (including specific loan loss provisions Rs 1,431.2 crore) against Rs 1,541.1 crore (including specific loan loss provisions Rs 1,132.5 crore) for the quarter ended March 2018.
Total advances as of March 2019 were Rs 819,401 crore, an increase of 24.5 percent over March 2018. Domestic advances grew by 24.6 percent over March 2018.
Its domestic retail loans grew by 19 percent and domestic wholesale loans by 31.9 percent. Overseas advances constituted 3 percent of total advances.
Total deposits were at Rs 923,141 crore in March 2019, an increase of 17 percent YoY. CASA deposits grew by 14 percent, with savings account deposits at Rs 2,48,700 crore and current account deposits at Rs 1,42,498 crore.
Other income (non-interest revenue) at Rs 4,871.2 crore was 27.1 percent of the net revenues for the quarter ended March 2019 and grew by 15.2 percent over corresponding quarter ended March 2018.
The four components of other income were fees and commissions at Rs 3,692.1 crore, as compared to Rs 3,329.7 crore in corresponding quarter of previous year, foreign exchange and derivatives revenue of Rs 403.3 crore (Rs 416.4 crore in corresponding quarter of previous year), gain on revaluation/ sale of investments of Rs 228.9 crore (a loss of Rs 22 crore in corresponding quarter of previous year) and miscellaneous income, including recoveries and dividend, of Rs 546.9 crore (Rs 504.5 crore).
The core cost-to-income ratio for the quarter was at 40.1 percent, as against 40.6 percent for the corresponding quarter ended March 2018.
The bank's total capital adequacy ratio (CAR) as per Basel III guidelines was at 17.1 percent as on March 2019 (14.8 percent as on March 31, 2018) as against a regulatory requirement of 11.025 percent.
Tier 1 CAR was at 15.8 percent as of March 2019 compared to 13.2 percent as of March 2018. Common Equity Tier 1 Capital ratio was at 14.9 percent as of March 2019.
DividendThe board of directors recommended a dividend of Rs 15 per share for financial year 2018-19 against Rs 13 per share for previous year.