HDFC Q1 net profit rises 22%; to invest up to ₹2,000 crore in HDFC Life via preferential issue

Housing Development Finance Corporation (HDFC) on Friday reported a 22% rise in its standalone net profit at ₹3,669 crore for the first quarter ended Q1 FY23 as compared to ₹3,001 crore in the same quarter last year. 

HDFC Ltd's net interest income (NII), the difference between interest earned and expended, rose over 7% to ₹4,447 crore as against ₹4,125 crore year-on-year (YoY). The reported NIM during the quarter was 3.4%.

Further, the board of HDFC at the meeting held today, along with its Q1 results, also approved the investment of an amount not exceeding ₹2,000 crore in the preferential issue of equity shares to be made by HDFC Life Insurance Company Limited, subject to approvals, if any.

It also gave its nod for raising of funds by way of External Commercial Borrowing (ECB) in the form ofloans for an amount of up to $1.5 billion equivalent, in accordance with directions/guidelines issued by Reserve Bank of India (RBI).

During the quarter ended June 30, 2022, individual loan disbursements grew by 66% over the corresponding quarter of the previous year. “Disbursements during the quarter marked the highest ever disbursements for the Corporation in the first quarter of any financial year so far,” the mortgage lender said.

As at June 30, 2022, the assets under management (AUM) stood at ₹6,71,364 crore as against ₹5,74,136 crore in the previous year. As at June 30, 2022, individual loans comprise 79% of the Assets Under Management (AUM).

As at June 30, 2022, the gross individual non-performing loans (NPLs) stood at 0.98% of the individual portfolio, while the gross non-performing non-individual loans stood at 4.44% of the non-individual portfolio. The gross NPLs as at June 30, 2022 stood at ₹10,288 crore. This is equivalent to 1.78% of the portfolio.

This marks an improvement compared to December 31, 2021 (the first time of reporting under the new norms), where the gross individual NPLs stood at 1.44% and the gross non-individual NPLs stood at 5.04% of the non-individual portfolio. Total NPLs as at June 30, 2022 has reduced to stand at 1.78% as against 2.32% as at December 31, 2021.