HDFC Bank Q2FY25 results: Net profit increases 5% to Rs 16,820 cr

The bank's gross non-performing assets was 1.36 per cent in Q2FY25, up from 1.33 per cent in Q1FY25

HDFC Bank, the country’s largest lender, on Saturday reported a 5.3 per cent year-on-year (Y-o-Y) growth in net profit at Rs 16,820 crore for the second quarter of financial year 2025 (Q2FY25), aided by net interest income (NII) and lower provisions.

However, sequentially net profit of the lender was up 4 per cent from Rs 16,175 crore in Q1FY25.

The lender had reported a net profit of Rs 15,976 crore in the corresponding period a year ago (Q2FY24).

The bank reported a NII of Rs 30,110 crore in Q2FY25, up 10 per cent from the corresponding period a year ago, aided by growth in advances. Sequentially, NII was up marginally from Rs 29,837 crore in Q1FY25. Net interest margin of the lender was flat to 3.46 per cent in Q2FY25, compared to 3.47 per cent.

Provisions of the lender stood at Rs 2,700 crore in Q2FY25, compared to Rs 2,602 crore in Q1FY25, and Rs 3,310 crore in Q2FY24.

The bank’s asset quality deteriorated, with gross non-performing assets (NPAs) at 1.36 per cent in Q2FY25, compared to 1.33 per cent in Q1FY25, and 1.34 per cent in Q2FY24. Net NPAs of the bank stood at 0.41 per cent compared to 0.39 per cent in Q1FY25.

The total credit cost of the bank stood at 0.43 per cent in Q2FY25, compared to 0.49 per cent in the corresponding period a year ago.

The bank has mobilised over Rs 1.2 trillion in deposits in Q2FY25, with total deposits of the bank at 25 trillion, up 15 per cent Y-o-Y and 5 per cent sequentially. The bank’s average deposit stood at Rs 23.50 trillion in Q2FY25.

Deposits growth in Q2FY25 outpaced credit growth. Deposits grew by 5 per cent and gross advances by 1.3 per cent compared to Q1. 

The bank got Rs 1 trillion of time deposits in the quarter and Rs 12,000 crore worth of savings deposits. The bank has the desire to grow its market share on deposits, said Srinivasan Vaidyanathan, CFO, HDFC Bank. 

The bank said its gross advances stood at Rs 25.19 trillion in Q2 FY25, up 7 per cent Y-o-Y and 2.3 per cent sequentially. Retail loans grew by 11.3 per cent Y-o-Y; commercial and rural banking loans grew by 17.4 per cent; and corporate and other wholesale loans were lower by 12 per cent. 

The bank has sold over Rs 19,000 crore worth of loan through assignments this quarter This is part of a strategic move for us This is a modest beginning for us If the market has the right kind of appetite, we will grow this going ahead, Vaidyanathan said. 

Credit Deposit ratio of the banks currently is at around 100 per cent. Pre-merger it was at 86-87 per cent. And the bank would like to bring it down the pre-merger level, he added. 

He further added that rate of growth of the bank has been modest compared to industry in unsecured loans. In FY23, unsecured loans were up 19 per cent Y-o-Y for the bank, when the industry grew at 28 per cent Y-o-Y growth. The bank has slowed the growth in the segment to 10 per cent in FY24 whereas the industry was growing at 21 per cent Y-o-Y, he added.