Shares of Housing Development Finance Corporation (HDFC) have been up 4 per cent at Rs 2,649.75 on the BSE in intra-day commerce on Wednesday, gaining 9 per cent previously three buying and selling days after the housing finance firm (HFC) reported a gradual efficiency for the quarter ended June 2021 (Q1FY22). The inventory was buying and selling larger for the fourth straight day.
India’s greatest mortgage lender HDFC on Monday reported a 1.6 per cent year-on-year (YoY) lower in standalone web revenue at Rs 3,001 crore for the April-June quarter of FY22 (Q1FY22) on the again of decrease different revenue and better tax and worker bills. In the year-ago interval, the revenue stood at Rs 3,051 crore. Sequentially, the revenue declined 5.6 per cent from Rs 3,180 crore.
On the income entrance, the lender’s web curiosity revenue (NII) got here in at Rs 4,147 crore for the quarter underneath evaluation, up 22.2 per cent in contrast with the earlier yr’s NII of Rs 3,392 crore. On a quarterly foundation, the revenue elevated marginally by 2 per cent from Rs 4,064.8 crore reported in Q4FY21. HDFC mentioned its gross non-performing loans as at June 30, 2021, stood at Rs 11,120 crore, equal to 2.24 per cent of the mortgage portfolio. The GNPA ratio in Q4FY21 stood at 1.98 per cent.
HDFC is the biggest non-banking finance firm (NBFC) engaged in housing finance enterprise. It has demonstrated constant efficiency when it comes to each enterprise development in addition to asset high quality. Individual loans contribute round 78 per cent of property underneath administration (AUM). The stakes in subsidiaries in insurance coverage and asset administration enterprise support worth.
Despite Covid-related lockdowns in the course of the quarter, particular person loans noticed a wholesome development of 14.5 per cent YoY to Rs 3.76 trillion. Corporate loans fell 9 per cent YoY to Rs 1.18 trillion. Management mentioned that demand for dwelling loans stays sturdy and disbursements have picked up.
Analysts at ICICI Securities anticipate a decide up in enterprise development led by market management. The funding benefit and satisfactory capital will support development and earnings, whereas wholesome provision buffer and enchancment within the assortment will support asset high quality, the brokerage agency mentioned in a end result replace.
“We believe that the company is able to gain the market share, especially from other HFCs and even smaller banks, due to its superior liability franchise and lower cost of fund. We remain bullish on home loan demand due to low-interest rates and various perks offered by the government,” analysts at Emkay Global Financial Services mentioned.
The brokerage’s market share evaluation suggests a constant market share loss by HFCs to banks, which it believes will intensify additional. Though HDFC nonetheless managed to carry its place resulting from a superior attain and the best-in-class legal responsibility franchise, the competitors stress within the housing section is imminent. The sharp shift in Stage 2 property to Stage 3 property could be a priority, nevertheless, the availability buffer supplies consolation, the brokerage agency added.