Despite high interest rate and a subdued economic environment, India's biggest housing finance company HDFC Ltd on Wednesday reported a 19% year-on-year increase in net profit at Rs. 1,002 crore during the April-June quarter against Rs. 845 crore in the year-ago period.
A 23% expansion of its loan book at Rs. 148,262 crore and 19% increase in net interest income (the difference between interest earned and interest paid) at R1,526 crore boosted profits.
Though the company outperformed market estimates of 18-20% growth for home loans, analysts said it still does not point to a revival in the housing market.
"The market has slowed down and high-value transactions have come down," said Ambar Maheshwari, MD, corporate finance, JLL, a real estate consultancy. "HDFC has done relatively well. There is still huge demand in lower and middle-income segments, especially in the NCR, Pune, Hyderabad, Bangalore and Chennai."
Income grew 29% to Rs. 4,935 crore in the quarter, while total assets grew 17% to Rs. 174,676 crore. Non-performing assets reduced from 0.8% to 0.79% of the total loan portfolio at Rs. 1,190 crore. "The results were largely in line with expectations. HDFC continues to grow its loan book faster than the industry growth rate in home loans," said Vaibhav Agrawal of Angel Broking.