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HDFC Ltd Q1 Results FY23

03 August 2022

Housing Development Finance Corporation (HDFC) Ltd posted its Q1 FY23 results on July 29, 2022. The company reported a 5% YoY (Year on Year) jump in its Profit After Tax (PAT) which came in at Rs 5,574 crore from Rs 5,310 in the year ago period. On a sequential basis, however, the PAT was down 19% to Rs 5,574 crore from Rs 6,892 crore in the previous quarter.

HDFC Ltd’s revenue from operations was down by 25% YoY at Rs 23,183 crore in the quarter under review from Rs 30,990 crore in Q1 FY22. The revenue from operations was down 33.8% QoQ (Quarter on Quarter) from Rs 35,046 crore in Q4 FY22. The company’s interest income rose by 16.8% YoY and 6.8% QoQ to Rs 12,457 crore. The reported NIM during the quarter ended June 30, 2022 was 3.4%.

However, the net loss on investment rose over 450% to a net loss of Rs 6,662 crore from a net loss of Rs 1,198 crore in the previous quarter. This offset the company’s rise in interest and dividend income, and income from insurance premiums too.

It’s not all gloom though. HDFC Ltd reported a significant reduction in its total expenses in the quarter. The total expenses were down by 29% YoY to Rs 18,384 crore from Rs 26,586 crore in the year ago period. The same was down by 37.5% QoQ to Rs 18,384 crore from Rs 29,451 crore in the previous quarter. This was largely due to a reduction in the claims paid to insurance policyholders.

On the lending front, the average size of individual loans stood at Rs 35.7 lakhs compared to Rs 33.1 lakhs in FY22. As at June 30, 2022, the outstanding amount in respect of individual loans sold stands at ₹ 88,856 crore for the company. Note that individual loans comprise 79% of the Assets Under Management. Total assets under management for HDFC Lts has risen to Rs 6,71,364 crore as against Rs 5,74,136 crore in the previous year. 

The shareholders of Housing Development Finance Corporation Limited have approved a final dividend of Rs 30 per share for the year ended March 31, 2022 at its 45th Annual General Meeting held on June 30, 2022.

HDFC’s scrip reacted positively to the result announcement and surged 1.53%, increasing to Rs 2,373.20 per share at 3:05 PM on July 29, 2022.

Hits of HDFC Q1 Results Fy 2023

  • PAT up 5% YoY to Rs 5,574 crore from Rs 5,310 in the year ago period
  • The company’s interest income rose by 16.8% YoY and 6.8% QoQ to Rs 12,457 crore
  • 66% growth in individual disbursements, 28% growth in individual loans. Disbursements during the quarter marked the highest ever disbursements for the Corporation in the first quarter of any financial year so far.
  • On an AUM basis, the growth in the individual loan book was 19%. This marks the highest percentage growth in the individual loan AUM in 8 years.
  • Earnings Per Share (EPS) up to Rs 29.26 from Rs 27.93 in the year ago period
  • Total expenses down by 29% YoY, 37.5% QoQ to Rs 18,384 crore for the quarter under review.

Misses of HDFC Results for Q1

  • PAT down by 19% QoQ to Rs 5,574 crore from Rs 6,892 crore in the previous quarter
  • Net loss on investment rose over 450% to a net loss of Rs 6,662 crore from a net loss of Rs 1,198 crore in the previous quarter
  • Revenue from operations down 25% YoY at Rs 23,183 crore from Rs 30,990 crore in Q2 FY2
  • Gross individual non-performing loans (NPLs) stood at 0.98% of the individual portfolio, while the gross non-performing non-individual loans stood at 4.44% of the non-individual portfolio
  • Earnings Per Share (EPS) down to Rs 29.26 from 35.66 in the previous quarter.

Segment-wise revenue

  • Loans: Revenue up 13.9% YoY to Rs 13,491 crore from Rs 1,839 crore in the year ago period
  • Life Insurance: Revenue down 61% to Rs 5,953 crore from Rs 15,298 crore in the year ago period
  • General Insurance: Revenue up 19.3% YoY to Rs 4,093 crore from Rs 3,428 crore in the year ago period
  • Asset Management: Revenue up 3.5% YoY to Rs 561 crore from Rs 542 crore in the year ago period
  • Others: Revenue up 39.5% YoY to Rs 194 crore from Rs 139 crore in the year ago period

Other things to know about HDFC Ltd

  • HDFC’s P/E ratio is at 18.77 against the sector P/E ratio of 20.19.
  • The company’s P/B ratio is at 2.20 against the sector P/B ratio of 2.17
  • HDFC’s dividend yield is at 1.28% against the sector yield of 0.86%

To read the RA disclaimer, please click here
Research Analyst: Bavadharini KS

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