HDFC BANK Q1 RESULTS 2025: NET PROFIT RISES, ASSET QUALITY WORSENS

HDFC Bank reported its June quarter numbers on Saturday afternoon,20th July. The results are below the market expectations. Let us look at HDFC Bank's Q1FY25 quarterly numbers in detail.

About HDFC Bank

The company needs no introduction. HDFC Bank and HDFC Limited merger is completed, which makes it one of the biggest banks in the world. HDFC Bank is one of the largest private sector banks in India. It was established in 1994. HDFC Bank provides a wide range of banking and financial services to individuals, businesses, and corporates.

Crucial Parameters

• PE Ratio: 20.11
• 52-week high: Rs 1,791.90
• Market Cap: 12,22,701.34 crore
• ROE: 13.9

Share Price Movement

On Friday, HDFC Bank's share price closed at Rs 1,607.30 on the NSE, down 1.16%. In the last six months, HDFC Bank has given negative 2.94%, and in one one-year, the returns are negative at 2.94%. In the 5-year time frame, HDFC bank share price is trading flat (on the negative side).

How has HDFC Bank performed in Q1FY25?

Below are key numbers related to HDFC Bank's results for the June 2024 quarter:

Revenue: HDFC Bank reported consolidated revenue of Rs 83,701 crore for Q1FY25, a growth of 106.5%%. In the year-ago period, the bank reported a net income of Rs 57,816 crore. In the previous quarter, the net revenue reported was Rs 80,700 crore, a low single-digit digit growth.

Net Interest Income (NII): It measures the difference between the interest income generated from loans, investments, and other interest-earning assets and the interest expenses incurred on deposits, borrowings, and other interest-bearing liabilities. It reflects the bank's ability to effectively manage its interest rate risk and generate profits from its interest-related operations.

The NII for HDFC Bank for the June quarter was Rs 29,840 crore, a jump of 26.4%. In the year-ago period, the net interest income was Rs 23,600 crore. In the March quarter, the NII was Rs 29,080 crore. The core net interest margin was 3.47% on total assets and 3.66% based on interest-earning assets.

Profits: The consolidated profit reported by HDFC Bank was Rs 16,470 crore for Q1FY25, a jump of 33.2% from the year-ago period. Earning Per Share (EPS) for the June quarter was Rs 21.7 (down from Rs 23.2 in the March quarter), and book value per share was Rs 625.4 (from Rs 600.8 in the previous quarter).

Other income: It includes non-interest income. It was Rs 10,670 crore. In the year-ago period, it was Rs 9,200 crore. Other income has four components - Fees and commissions stood at Rs 7,050 crore. Foreign exchange and derivative revenue were reported at Rs 1,400 crore, net trading and mark-to-market gains of Rs 220 crore, and miscellaneous income of Rs 2,010 crore.

Deposits: HDFC bank reported a total deposit of Rs 23.79 lakh crore, a growth of 24.4% year on year. CASA deposits increased by 6.2%, with savings account deposits at Rs 5.96 lakh crore and current account deposits at Rs 2.67 lakh crore.

The Time deposits saw exceptional growth numbers. It grew to Rs 15.15 lakh crore with a 37.8% increase. The overall CASA deposits comprised 36.2% of total deposits at the end of the June quarter.

Gross Advances increased by 52.6% at Rs 24.87 lakh crore. Domestic retail loans grew by 100.4%, commercial and rural bank loans increased by 23%, while overseas advances constituted 1.5% of total advances.

Asset Quality: The HDFC Bank reported Gross non-performing assets (NPAs) at 1.33% of gross advances for Q1FY25, as against 1.17% in Q4FY24 and 1.17% in Q1FY24. The Net NPA was at 0.39% of net advances at the end of the June quarter, as compared to 0.33% as of March 31, and 0.30% as of June 30, 2023.

In absolute terms, the gross NPA of the HDFC bank rose to Rs 33,025.69 crore as of June 30, as against Rs 31.173.32 crore as of March 31, 2024, and Rs 19,064.12 crore as of June 30, 2023.

How have HDFC Bank subsidiaries performed in Q1FY25?

HDFC Securities Limited (HSL): It is amongst the leading retail broking firms in India. At the end of the June quarter, the bank held a 95.2% stake in HSL. For the quarter ended June, HSL's total revenue was Rs 820 crore, as against Rs 500 crore in the year-ago period. Profit after tax for the quarter was Rs 290 crore, as against Rs 190 crore for the quarter ended June 2023.

HDB Financial Services Limited (HDBFSL): It is a non-deposit-taking non-banking finance company (NBFC) offering a wide range of loans and asset finance products to different customer segments. As of June 2024, the Bank held a 94.6% stake in HDBFSL. For Q1FY25, HDBFSL's net revenue was at Rs 2,390 crore as against Rs 2,310 crore for the quarter ended June 2023. Profit after tax for the quarter ended June, was Rs 580 crore compared to Rs 570 crore in the year-ago period, a growth of 2.6%.