HDFC Bank Q4 Results Preview: Profit could rise 25%, net interest income may grow over 10%
Pre-provision operating profit is also expected to grow in the range of 15-20 percent in the March quarter YoY.
April 17, 2021 / 09:02 AM IST
Country's largest private sector lender HDFC Bank is expected to report around 25 percent year-on-year growth in standalone profit for the quarter ended March 2021, due to a low base in year-ago period. The bank will release quarterly earnings on April 17.
Loan growth at 13.9 percent YoY was driven by the corporate book that registered 21 percent YoY growth, and domestic retail loan book grew by 7.5 percent in March quarter compared to the corresponding period.
The bank earlier in the April said deposits at Rs 13,35,000 crore as of March 2021 grew by around 16.3 percent over a year ago period.
Brokerages largely expect net interest income to grow around 10-11 percent YoY with net interest margin at around 4.1-4.2 percent for the quarter ended March 2021.
"NII growth is seen at 11 percent YoY to Rs 16,901 crore, and expect margins moderating to 4.1-4.2 percent led by higher corporate book growth," said ICICI Direct, which sees 25.6 percent growth in profit YoY.
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According to the brokerage, the asset quality is expected to slip as recognition post standstill to lead to mild increase in gross NPA. "Proforma GNPA and restructuring numbers were lower under 2 percent. We expect provision to stay stable at Rs 3,396 crore with PAT growth expected to be at 25.6 percent YoY due to lower base in Q4FY20," the brokerage said.
HDFC Bank shares have corrected half a percent in the year 2021 so far, but gained 62 percent in the last one year.
Pre-provision operating profit (PPoP) is also expected to grow in the range of 15-20 percent in the March quarter YoY.
Watchful of asset quality in agri and unsecured book, and the commentary around credit cards and fee income traction will be key things to watch out for, said Motilal Oswal which sees profit growth at 30 percent and NII growth at 14.3 percent YoY.