HDFC Q1 Net up 10% at Rs 1872.9cr; Rs 78cr deferred tax payout

Mortgage lender HDFC today reported nearly 10 per cent rise in consolidated net profit at Rs 1,872.9 crore for the first quarter ended June 30 helped by loan growth.
The company had posted consolidated profit of Rs 1,707.1 crore in the April-June quarter in the previous fiscal.
During the reporting quarter, sectoral regulator National Housing Bank had asked home finance companies to create a deferred tax liability on the amount outstanding in the special reserves, due to which the mortgage giant had to take a hit of Rs 78.67 crore on consolidated basis and Rs 74.44 crore on standalone basis.

Total consolidated income increased from Rs 5,564.94 crore for the quarter ended June 30, 2013 to Rs 6,461.24 crore for the quarter ended June 30, 2014.
On a standalone basis, it posted a 15 per cent growth in its June quarter net at Rs 1,344.66 crore.
The city-headquartered company, the largest dedicated mortgage player in the market, had posted a standalone net profit of Rs 1,173.10 crore in the corresponding period last year.

Total income from operations in the first quarter ended June 30 moved up to Rs 6,461.24 crore from Rs 5,564.94 crore in the same period last year.

Net interest margin was down marginally at 3.8 per cent from 3.9 per cent a year ago.
HDFC Vice-Chairman and Chief Executive Keki Mistry, however, said it is the spread between the lending rate and the cost of funds which is more important, and added that this was stable at 2.29 per cent.
There was a 14 per cent increase in total assets in Q1 at Rs 2.30 trillion (Rs 2.3 lakh crore), while the loan book stood at Rs 2.03 trillion as of end June.
Mistry said the loan growth was driven primarily by individual loans, which were up 23 per cent. The average loan size improved during the quarter to Rs 22.70 lakh from Rs 22.10 lakh for the entire last fiscal.

On the asset quality side, HDFC's gross non-performing assets improved to 0.70 per cent from 0.77 per cent in the year ago period.
Total provisions for contingencies stood at Rs 1,925 crore of which Rs 464 crore were for bad assets, he said, adding HDFC carries an excess provision of Rs 423 crore.
Asked about the impact of Budget announcement of upping foreign holding in insurance firms to 49 per cent (from current 26 per cent), Mistry said the company is meeting its foreign joint venture partners in both the general and life insurance subsidiaries on August 1 to discuss the same.

He, however, was quick to add that no one knows the exact contours of the proposed amendment as the Insurance Bill is yet to be tabled in Parliament.
The HDFC counter rallied 3.06 per cent to Rs 1,011.05 a piece on the BSE, whose 30-share Sensex gained 0.29 per cent.