HDFC Bank gains nearly 1% on quarterly earnings

Shares of HDFC Bank increased nearly 1 per cent after the private sector lender reported a 20 per cent rise in net profit for the December 2018 quarter.

Its shares gained 0.72 per cent to close at Rs 2,146.55 apiece on the BSE. During the day, it touched a high of Rs 2,165, up 1.58 per cent from the previous close.

Following the uptrend, the stock settled at Rs 2,145.40, a gain of 0.71 per cent, on the National Stock Exchange (NSE). It was trading at an intra-day high of Rs 2,166.50, 1.70 per cent higher from the previous close.

In terms of equity volume, 1.80 lakh shares were traded on the BSE, while over 43 lakh scrips of the bank changed hands on the NSE during the day.

The private sector lender Saturday reported a 20.3 per cent growth in net profit to Rs 5,585.9 crore for the third quarter ended December 31, mainly on account of higher net interest income (NII).

The bank had posted a net profit of Rs 4,642.6 crore in the October-December quarter of 2017-18.

Total income of the lender rose to Rs 30,811.27 crore during the quarter, against Rs 24,450.44 crore in the year-ago period.

"In the December quarter 2018-19, HDFC Bank's operating profit was in line with our expectations, while bottomline was below our expectations by 5 per cent on account of higher provisions," Elara Capital said in a research note, adding that the company's asset quality continues to remain robust except for some concerns in agri portfolio.

NII, which is interest earned minus interest expended, grew 21.9 per cent to Rs 12,576.8 crore, compared with Rs 10,314.3 crore a year ago, driven by asset growth of 23.7 per cent and a core net interest margin of 4.3 per cent for the quarter, it said.

During the quarter, the bank's gross non-performing assets (NPAs) rose to 1.38 per cent of the total advances, compared with 1.29 per cent at the end of the third quarter of 2017-18.

Net NPAs of the bank declined to 0.42 per cent of the assets in October-December 2018, against 0.44 per cent a year ago.