Economy

Sale of subsidiaries gives HDFC profit a shot in the arm

Sale of subsidiaries gives HDFC profit a shot in the arm

HDFC on Monday announced a 28.6% rise in consolidated net profit at Rs 3,961 crore for the quarter ended March 2018 (Q4FY18), compared with Rs 3,079 crore during the year-ago period.

As on March 31, 2018, the loan book size stood at Rs 3,59,442 crore as against Rs 2,96,472 crore in the previous year.

HDFC clocked Rs 265.46 crore in pre-tax gains due to profit on sale of investments after the corporation sold 100% equity share capital in HDFC Developers and HDFC Realty to Quikr India.

The reported profit before tax for the year ended March 31 stood at Rs 15,264 crore compared to Rs 10,727 crore in the previous year - an increase of 42 percent.

In the reporting quarter, revenue from operations rose 10 per cent year-on-year (yoy) to Rs 9,328 crore.

HDFC has one of the best home loan portfolios with the lowest level of NPAs that stand at around 1 percent. Housing finance major recorded a 63 per cent jump in net profit at Rs 12,164 crore against Rs 7,443 crore in the financial year.

"The Corporation has made an additional provision of Rs 80 crore to shore up the provision & contingencies account and thereby recognise provisions towards specific loans against future risks", HDFC said in its filing. It also came to light that the net interest income of the company was at Rs 3,617 crore, registering a 12.4 per cent Y-o-Y increase in comparison to Rs 3,216 crore in the same quarter previous year.

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HDFC's total individual loan disbursements grew by 29 per cent during the year ended March 31, 2018. Similarly, net NPAs in the individual loan portfolio stood at 0.64 per cent, while non-industrial portfolio net NPAs were relatively higher at 2.18 per cent.

According to a Kotak report, "With an improvement in momentum in the retail business, we expect HDFC's loan growth to inch up to 18 percent (17 percent in Q3FY18)".

The board of HDFC has approved NCDs (secured or unsecured) up to Rs 85,000 crore on a private placement basis, subject to the approval of members at the upcoming AGM.

The Board has recommended a final dividend of Rs 16.50 per equity shares of face value Rs 2 each for FY2017. -18.

It also announced resignation of Non-Executive Director D M Sukthankar and Independent Director D N Ghosh from the board with effect from April 30.

Besides the result, a confirmation was also received indicating that Keki Mistry would be reappointed as the MD for a period of three years starting November 14 in the current year.

Shares of HDFC closed 1.44% per cent or 26 points higher at Rs 1,884 per scrip on BSE.


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