The headquarters of India’s HDFC bank is pictured in Mumbai.
| Photo Credit: Reuters
Mortgage lender Housing Development Finance Corporation Ltd. (HDFC) reported that its fourth quarter net profit grew 20% year-on-year (YoY) to ₹4,425 crore owing to significant improvement in asset quality.
The net interest income (NII) for the quarter ended March 31, 2023 stood at ₹5,321 crore, up 16% YoY. “During the year, the monetary policy and interest rate actions did have an impact on NII,” HDFC said in a statement.
Though lending rates increased, there has been a transmission lag between the interest rate increase in borrowing costs and asset repricing, it said.
During the quarter HDFC assigned loans amounting to ₹9,340 crore as compared with ₹8,367 crore a year ago.
Profit after tax for the year ended March 31, 2023 stood at ₹16,239 crore, up18% than the previous year.
The Board of Directors declared an interim dividend of ₹44 per equity share. The dividend pay-out ratio is 49.7%, the company said.
“The inherent demand for home loans continues to remain strong. Growth in home loans was seen predominantly in the mid-income segment and high-end properties,” said Keki Mistry, Vice Chairman & CEO, HDFC Ltd.
“During the year ended March 31, 2023, individual loan disbursements grew by 16% compared to the previous year. In the month of March 2023, HDFC recorded its highest-ever monthly individual disbursements,” he added.
During the year, the average size of individual loans stood at ₹36.2 lakh compared to ₹33.1 lakh in the previous year.
As of March 31, 2023, the assets under management stood at ₹7,23,988 crore as against ₹6,53,902 crore in the previous year. As of March 31, 2023, individual loans comprised 83% of Assets Under Management (AUM).
As of March 31, 2023, the outstanding amount in respect of individual loans sold was ₹1,02,071 crore. HDFC continues to service these loans.
Based on the revised norms by the Reserve Bank of India there has been a significant improvement in non-performing loans (NPLs), HDFC said.
Gross NPLs as of March 31, 2023 stood at ₹7,246 crore. This is equivalent to 1.18% of the portfolio as against 1.91% in the previous year. As of March 31, 2023, HDFC carried a total provision of ₹12,145 crore against loans.
NII for the year ended March 31, 2023 stood at ₹19,248 crore, compared with ₹17,119 crore in the previous year. The reported Net Interest Margin for the year ended March 31, 2023 was 3.6%.
For the year ended March 31, 2023, the company reported consolidated profit after tax of ₹26,161 crore as compared to ₹22,595 crore in the previous year, up 16%.
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