The country’s largest mortgage lender, Housing Development Finance Corporation (HDFC), registered a near four-fold rise in net profit for the third quarter of the fiscal, with doubling of total income after the merger of Gruh with Bandhan Bank.
The standalone net profit of HDFC shot up to ₹8,372.49 crore in the October to December 2019 quarter against ₹2,113.80 crore in the same period a year ago.
The board also approved the issue of non-convertible debentures up to ₹45,000 crore on a private placement basis.
Gruh-Bandhan merger
Its net interest income grew by nine per cent to ₹3,239.92 crore for the third quarter of the fiscal from ₹2,983.89 crore a year ago. Net interest margin fell marginally to 3.3 per cent this quarter against 3.4 per cent a year ago. HDFC also reported a fair value gain of ₹9,019.81 crore in the quarter ended December 2019 from the merger of Gruh Finance with Bandhan Bank effective October 17, 2019.
“The corporation (HDFC) was allotted 15.93 crore shares, aggregating 9.9 per cent of the total issued share capital of Bandhan Bank,” it said in a regulatory filing on Monday.
Accordingly, its total revenue from operations for the third quarter soared to ₹20,285.47 crore against ₹10.575.03 crore in the same period last fiscal.
Total income for the third quarter also doubled to ₹20,291.45 crore for the third quarter of the fiscal from ₹10,582.49 crore a year ago.
Provisioning rises
During the quarter, HDFC’s provisions spiked to ₹2,995 crore. Gross non-performing loans stood at ₹5,950 crore or 1.36 per cent of loan portfolio as on December 31, 2019, against 1.22 per cent a year ago.
“Total individual loan approvals grew by 15 per cent and disbursements grew by 13 per cent. The average size of individual loans stood at ₹ 26.9 lakh,” HDFC said in a statement.
As of December 31, 2019, the loan book grew by 13 per cent to ₹4,41,472 crore against ₹3,89,421 crore in the previous year. Individual loans comprise 76 per cent of the Assets Under Management (AUM).
“Given the prolonged uncertainty and risk averseness in the lending environment for non-individual loans, the corporation continued to be prudent in its lending,” it further said.
Shares of HDFC, however, fell 2.25 per cent and closed at ₹2,395.80 apiece on the BSE on Monday.