Prabhudas Lilladher's research report on HDFC
HDFC's core performance adjusting for onetime gains were slightly above expectations as NII growth was better on back of strong loan growth of 19% YoY from all segments. HDFC booked Rs52.0bn of investment gains from HDFC Life IPO and as a policy provided Rs15.8bn (30% of gains) as contingent provisions helping further strengthen balance sheet. Company also got benefit of tax credit on investment gains and hence had lower tax leading to beat in earnings.
Outlook
We have slightly revised our growth estimates upwards and adjusted tax rate lower for FY18. We revise our TP to Rs2,160 (up from 2,000) and retain BUY with stable spreads and improving growth.For all recommendations report, click here
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