HDFC Bank Shares Jump 2% After In-Line Q3 Profit Driven by Higher Interest Income

Shares of HDFC Bank witnessed a sharp recovery from the day’s low on Wednesday after the bank reported a 2.2% year-on-year (YoY) growth in its December quarter standalone net profit, totaling Rs 16,736 crore, compared to Rs 16,373 crore posted in the corresponding quarter of previous fiscal.

India’s largest private lender reported Net Interest Income (NII) of Rs 30,650 crore in Q3FY25, up 7.7% from Rs 28,470 crore for the quarter ended December 31, 2023.

On a sequential basis, the profit slipped marginally from Rs 16,820.9 crore.

The interest earned by the bank in Q3FY25 stood at Rs 76,007 crore, up 7.6% from Rs 70,783 crore in the corresponding quarter of the previous financial year. Core net interest margin stood at 3.43% on total assets and 3.62% based on interest-earning assets, according to its filing to the exchanges.

The stock surged 1.8% intraday to touch a high of Rs 1,671.90 per share. The stock recovered 2.85% from the day’s low of Rs 1,625.3.

HDFC Bank shares settled at Rs 1,671.90, up 1.80% or 29.50 points from previous day’s close.

However, the bank’s asset quality worsened during the quarter with the gross non-performing asset ratio (GNPA) rising to 1.42% in December quarter from 1.36% in September quarter of FY25.

Net NPA ratio increased to 0.46% from 0.41% QoQ and 0.31% YoY.

Provisions and Contingencies surged to Rs 3,135.8 crore from Rs 2,700.5 crore set aside in Q2FY25. However, on a yearly basis, provisions were down from Rs 4,216.6 crore.

The bank’s average deposits stood at Rs 24,52,800 crore for Q3FY25 quarter, a 15.9% increase over Rs 21,17,100 crore for the Q3FY24 quarter. On a sequential basis, average deposits grew 4.2% over Rs 23,54,000 crore for the September 2024 quarter.

The bank reported average CASA deposits of Rs 8,17,600 crore for December 2024 quarter, up 6% from Rs 7,71,100 crore in December 2023 quarter and 1.1% from Rs 8,08,400 crore for the September 2024 quarter.