India’s second-largest private lender, HDFC Bank, on Tuesday announced a 27% year-on-year rise in net profit to `1,982 crore in July-Septenber, its slowest growth in quarterly profit in a decade, mainly due to a drop in net interest margins, losses in investment portfolio and muted growth in
The muted profit growth sent the company’s shares down 2% to `651 on the Bombay Stock Exchange.
The bank had reported a profit of `1,559.9 crore a year ago.
Until the quarter ended September, HDFC Bank had reported quarterly profit growth exceeding 30% for the last decade.
“I expect corporate loan demand to pick up in the next two quarters mainly because there has been a slump in demand so far,” said Paresh Sukthankar, executive director, HDFC Bank.
Net interest income (the difference between interest earned and interest paid) grew 15% to `4,476.5 crore during the quarter compared with `3,882 crore in the year-ago period. Other income increased 25% to `1,844 crore from `1,472 crore in same quarter of the previous year.
Net interest margin declined to 4.3% against 4.4% a y.ear ago
“In light of current macro environment, the current earnings trajectory of 27% is impressive and much better than other large private peers,” said Vaibhav Agrawal, analyst, Angel Broking.
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