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Q4 Preview: HDFC Bank likely to record 22% rise in profit on higher net interest income

On April 15, HDFC Bank, India’s biggest lender by market capitalization, will publish its corporate results for the January-March 2023 period. Profits are expected to grow to Rs 12,181 crore, according to the average of three brokerage polls.

Net interest income (NII) is predicted to expand 30.5 percent year on year (up 8.8 percent QoQ) to Rs 24,601.9 crore, while HDFC Bank earnings are likely to rise 21.9 percent year on year (YoY).

The bank’s financial results come at a time when the RBI has delayed key interest rates for the time being but has hinted at future hikes in its quest to further lower inflation without harming economic development. While the Federal Reserve continues to battle stubbornly high US inflation, another rate rise is expected at the upcoming FOMC meeting. Fears of a worldwide recession are increasing due to the same reason.

According to brokerage company Prabhudas Lilladher, HDFC Bank’s Q4 net profit increased 21.8 percent year on year to Rs 12,245.4 crore. Net interest income (NII) is estimated to rise 32.5 percent year over year (up 8.8 percent quarter over quarter) to Rs 24,999.9 crore.

Elara Securities expects HDFC Bank to post a 24.4 percent YoY increase in profit for the March quarter, to Rs 12,507 crore, compared to Rs 10,055 crore in the same period last year. Net interest income is expected to rise 28.2 percent year on year, to Rs 24,204 crore from Rs 18,872 crore.

“As reported in provisional updates, business momentum has turned out strong with loan growth of 16.9 percent YoY and 6.2 percent QoQ. Deposit growth of 20.8 percent YoY and 8.7 percent QoQ was higher than our estimates. We are yet to align reported numbers to show outperformance,” Elara Securities said.

Emkay Global forecasts NIM to be 4.3 percent for the quarter, up 5 basis points year on year. It anticipates that HDFC Bank will post solid profitability, “driven by healthy NII growth and contained provisions. “Slippages are likely to decrease on a quarterly basis owing to decreasing stress from the farm portfolio,” it added, forecasting a profit of Rs 12,037 crore, up 19.7 percent year on year.

HDFC Bank Q4 most recent business update

In a recent business report, HDFC Bank said that its loans were at Rs 16,00,500 crore at the end of March 31, 2023, representing a 6.2 percent quarter-on-quarter rise. According to a firm statement, its advances or loans increased by 6.5 percent sequentially, taking into account gross transfers via interbank participation certificates and bills.

 

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