Money & Banking

HDFC reports 22% fall in Q4 net profit

Our Bureau Mumbai | Updated on May 25, 2020

Housing Development Finance Corporation Ltd’s standalone net profit fell 22 per cent in the fourth quarter of FY20 to ₹2,232.53 crore against ₹2,861.58 crore a year ago.

The housing finance company said the fourth quarter numbers are not comparable to the previous year as it received dividend of just ₹2 crore; profit on sale of investments was also ₹2 crore and there were fair value changes and increased provisioning for Covid-19.

“After adjusting for fair value adjustments, profit on sale of investments, dividend and provisioning, the adjusted profit before tax for the quarter is ₹3,535 crore, compared to ₹3,064 crore in the previous year, reflecting a growth of 15 per cent,” HDFC said in a statement on Monday.

In FY20, net profits surged by over 78 per cent to ₹ 17,169.65 crore when compared to ₹9,632.46 crore a year ago.

For the quarter ended March 31, 2020, its total income grew 3.4 per cent to ₹ 11,981.66 crore, against compared to ₹11,586.58 crore in the same period a year ago.

Net interest income grew 17 per cent to ₹3,780 crore in the quarter under review. Net interest margin stood at 3.4 per cent when compared to 3.3 per cent in 2018-19.

Total loan book

HDFC CEO and Vice-Chairman Keki Mistry noted that the company saw very robust growth till March 15. Briefing reporters about the results, he said the total loan book grew by 12 per cent.

Total individual loan approvals grew by 14 per cent in volume terms and 12 per cent in value terms. Disbursements grew by 7 per cent and the average size of individual loans stood at ₹27 lakh.

Loan book grew by 11 per cent to ₹4.5-lakh crore as on March 31, 2020, from ₹4.06-lakh crore in the previous year.

The gross non-performing loans as of March 31, 2020, stood at ₹8,908 crore or 1.99 per cent of the loan portfolio. The non-performing loans of the individual portfolio stood at 0.95 per cent while that of the non-individual portfolio stood at 4.71 per cent.

The mortgage lender also reported increase in provisioning, including impact for Covid-19 of ₹ 1,274 crore in the fourth quarter, when compared to ₹398 crore a year ago.

HDFC said that given the prolonged uncertainty and risk averseness in the lending environment for non-individual loans, it remains prudent in its lending.

As of date, about 26 per cent of the Corporation’s loans under management have opted for the moratorium. Individual loans under moratorium account for 21 per cent of the individual loan portfolio.

HDFC’s capital adequacy ratio stood at 17.7 per cent, of which, Tier I capital was 16.6 per cent and Tier II capital was 1.1 per cent.

The board of directors also recommended payment of final dividend of ₹21 per equity share of ₹2 each for FY20 when compared to a final dividend of ₹ 17.50 per equity in the previous year.

Published on May 25, 2020

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