IPO income boosts HDFC bottomline by 25% to Rs 2,467 crore

Mumbai: Mortgage leader HDFC Thursday reported a 25 percent rise in standalone net income at Rs 2,467.08 crore in the three months to September, boosted by investment income from part-selling its stake in the mutual fund arm during the quarter through an IPO, coupled with robust loan demand.

Vice-chairman Keiky Mistry said the company has no issue liquidity issues, despite the crisis in the system and also that it has no exposure to the crippled IL&FS group's debt instruments.

"We've some indirect exposure to the IL&FS group by way of funding a building in the BKC area of the city, but that is fully secured with lease-rentals, which are being paid on time. Though the asset is standard, we have made a 37 percent provision for the same," Mistry told reporters during the earnings presser.

Mistry said strictly speaking the numbers are not comparable as the quarter saw little dividend coming in from the banking arm, as it had paid Rs 585.85 crore dividend in the June quarter, against the normal practice of paying in the September quarter.

During the reporting quarter, HDFC Bank paid just Rs 5.77 crore in dividend, which was Rs 536.59 crore in the year-ago period.

Similarly, the number also includes Rs 1,000.02 crore coming in from the IPO of HDFC AMC, which was listed during the reporting quarter, he said.

He said the company's loan book swelled 17 percent during the quarter, led by individual borrowers who constitute over 73 percent of the total volume, which clipped past 25 percent, while the affordable housing loans swelled by 37 percent.

Giving a break-up of the loan book, Mistry said while individual loan book accounts for 73 percent, up from 71 percent a year ago, construction finance accounts for 12 percent, 9 percent is from lease-rentals and the remaining 6 percent comes from corporate loans.

But as much as 81 percent of the total loan book during the quarter has come from individual borrowers, he added.

The bottomline was also helped by better asset quality with the bad loans ratio coming down to 1.13 percent to Rs 4,278 crore in the quarter, from 1.18 percent a year ago, and a steady spread, which remained stable at 2.28 percent helping the company log in an 18 percent growth in the core net interest income at Rs 9,673.31 crore.

The non-performing assets (NPAs) in the individual loan portfolio stood stable at 0.66 percent, while the same for non-individual portfolio stood at 2.18 percent.

The company made a provision of Rs 5,071 crore against a regulatory requirement of Rs 2,951 crore, Mistry said.

Total income during the September quarter stood at Rs 11,256.96 crore, up from Rs 9,007.37 crore in the same period previous fiscal, he said, adding net interest income grew 18 percent to Rs 5,343 crore.

The company's capital adequacy ratio stood at 18.4 percent, of which the core tier 1 capital stood at 17.1 percent.

Shares of HDFC closed nearly flat at Rs 1,761.70, down 0.44 percent on the BSE, while the benchmark Sensex closed little changed in a dull trade.