HDFC has registered an 83 per cent growth in its third-quarter net profit at Rs 648.93 crore against Rs 355.49 crore in the corresponding quarter of the previous year, mainly on account of the sale of its investment in the insurance subsidiary, HDFC Standard Life.
HDFC made a profit of Rs 120.94 crore by selling 7.15 per cent of its stake in ‘HDFC Standard Life’ to its UK partner Standard Life. If this stake sale is barred then HDFC has shown a 49 per cent growth in its net profit at Rs 528 crore.
“Growth in the book and better spreads has contributed to the rise in the net profit,” said Mr Conrad D’Souza, Senior General Manager, Treasury, and HDFC.
At the end of December 31, 2007, the net interest margin (the difference between average lending rates and borrowing costs) stood at 2.33 per cent, higher than 2.18 per cent at the end of December 2006. The cost of funds was higher at 9.01 per cent (7.84 per cent) while the yield on advances also went up to 11.31 per cent (10.02 per cent) throughout the same period. “Growth in the business has generally been on target at 27-30 per cent. Interest rates have been steady since April while financial support costs have dropped as the liquidity in the system is more than what it was last year,” Mr D’Souza.
HDFC’s interest income was up 46 per cent at Rs 1,981 crore against Rs 1,358 crore. Other in service income was also higher at Rs 65 crore against Rs 28 crore. Total income (excluding profit on sale of investments) rose 48 per cent to Rs 2,155 crore (Rs 1,458 crore) while total operating cost was somewhat higher by 38 per cent to Rs 1,394 crore (Rs 1,013 crore). Loan disbursements during the first nine-months of the economic grew by 28 per cent at Rs 22,285 crore (Rs 17,465 crore) while approvals increased 30 per cent to Rs 29,376 crore (Rs 22,666 crore).
HDFC’s loan portfolio as on December 31, 2007 amounted to Rs 68,151 crore, 25 per cent up from Rs 54,633 crore in the previous year. The housing finance major’s capital sufficiency ratio was at 17.6 per cent, much higher than 13.7 per cent in the earlier year. On real estate prices, Mr D’Souza said that based on the linkage between real land and the stock market, prices should see some cooling.
HDFC’s shares closed at Rs 2,819.8 on the BSE, 1.05 per cent lower than the previous close at Rs 2,849.7.
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