HDFC profit to grow by one-third on dividend income boost but margin might shrink
HDFC results: Analysts expect Housing Development Finance Corp (HDFC) to report a 10.8 year-on-year rise in net interest income in the April-June period.
Housing Development Finance Corporation (HDFC) is all set to report its financial results on Friday. Investors will look out for changes in the mortgage lending giant's margin, its asset quality and the management commentary.
Analysts in a CNBC-TV18 poll estimate HDFC's profit for the April-June period at Rs 3,908.4 crore, which would translate to a 30.2 percent jump compared with the corresponding quarter a year ago.
They expect HDFC's net interest income — or the difference between interest earned and interest paid — to come in at Rs 4,593.5 crore, up 10.8 percent on a year-on-year basis.
According to Kotak Securities, the mortgage lender's net interest margin is estimated to decline by 19 basis points sequentially. Net interest margin is a key measure of profitability for financial institutions.
They expect a surge in dividend income to boost HDFC's profitability in the three-month period.
In a quarterly business update this month, HDFC had reported a more than fivefold increase in dividend income to Rs 687 crore for the April-June period compared with the previous quarter.
Its individual loans sold stood at Rs 32,499 crore, up 14.2 percent on a quarter-on-quarter basis, according to the update.
HDFC Bank — India's largest bank by market value — is buying its biggest shareholder, HDFC, in a mega $40-billion deal that will create one of the largest financial services companies in the world.
First Published: Jul 28, 2022 6:05 PM IST
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