HDFC has said that the company is well placed to deliver 18—20 per cent loan growth with stable margins and asset quality driven by growth in the smaller towns.

Giving their presentation at the CLSA investor forum, HDFC Chairman Deepak Parekh, Vice Chairman and CEO Keki Mistry and MD Renu Karnad highlighted that the competitive environment has been stable and HDFC can deliver 18—20 per cent loan growth with stable margins and asset quality.

At present, home ownership levels in India are under penetrated and considering the favourable demographics, financiers can reap positive results in the long run.

According to the management while metros have seen some moderation in demand due to high interest rates and property prices, growth from smaller towns is holding—up well and will be the key growth driver.

At present HDFC has a widespread branch reach with nearly 320 own outlets. Besides, more than 2,500 branches of HDFC Bank market HDFC’s mortgage loans. It has also tied—up recently with IndusInd Bank.

The management highlighted that not only are the longer—term potentials of mortgage financing strong in India, near—to—medium term demand is also holding—up well.

It also highlighted that the HDFC’s consolidated profit is likely to grow faster, driven by growth of profit in HDFC Bank and the profits of the life and general insurance subsidiaries.

“Stable competitive environment in mortgage lending and HDFC’s focus on the high underwriting standards, for retail and corporate loans, are the key drivers of its superior asset quality,” according to a CLSA report.

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