HDFC Bank Results: Anticipating Robust Q3 Performance with Over 30% YoY Profit Growth

HDFC Bank Results: HDFC Bank is set to announce impressive financial results for the December quarter, with analysts predicting a notable 30% YoY growth in net profit, primarily propelled by a substantial 25% YoY surge in net interest income (NII). The bank’s net interest margin (NIM) is anticipated to show a marginal recovery from the Q2 low, standing at 3.4% on total assets and 3.6% on interest-earning assets.

“For the December quarter, HDFC Bank showcased a provisional loan growth of 62.4%, with retail loans experiencing an impressive 111% YoY surge, commercial and rural banking loans growing by 31.5%, and other wholesale loans increasing by 11% YoY. The bank’s deposits also witnessed a robust growth of 27.7%”.

KRChoksey Shares and Securities anticipates HDFC Bank to report a 32% rise in net profit, reaching Rs 16,180.70 crore compared to Rs 12,259 crore YoY. The brokerage expects NII to stand at Rs 29,371 crore, marking a significant 27.8% YoY increase over Rs 22,988 crore. The cost-to-income ratio is estimated to be around 40.2%, a slight uptick from 39.6% in Q3FY23, while asset quality is expected to remain stable.

Motilal Oswal Securities projects a 32.5% YoY increase in profit to Rs 16,242 crore, driven by a 26.8% YoY rise in NII to Rs 29,142 crore. The brokerage foresees a slight improvement in margins from the Q2 lows and gross non-performing assets at 1.3% compared to 1.2% YoY.

Axis Securities, expecting a 30.2% YoY profit increase, suggests that margins likely bottomed out in Q2FY24 and are anticipated to improve sequentially. The provision for the quarter is projected to rise by 6.7% YoY to Rs 2,994 crore, with NII growth at 27.8% and non-interest income growth at 30.4% YoY.

Emkay Global anticipates margin recovery of 5 basis points QoQ, attributing it to the largely resolved impact of ICRR and MCLR revision. Overall, the consensus among analysts points towards a strong Q3 performance for HDFC Bank, marked by substantial growth in key financial metrics and a positive outlook for the coming quarters.