HDFC Q3 profit jumps four-fold to Rs 8,372 crore; to raise Rs 45,000 crore via NCDs

Housing Development Finance Corporation (HDFC) on Monday reported nearly four-fold jump in its net profit at Rs 8,372.49 crore for the third quarter ended December 31, 2019, driven by a value gain of Rs 9,019.81 crore from the merger of Gruh Finance, an associate, with Bandhan Bank.

The mortgage lender had posted a net profit of Rs 2,113.80 crore in December quarter of 2018 and Rs 3,961.53 crore in September quarter of this fiscal. On a consolidated basis, the net profit attributable to owners stood at Rs 3,835.38 crore.

HDFC has sold 9.90 per cent stake in its subsidiary Gruh Finance Ltd (Gruh), under the RBI directive to bring down holding in subsidiary firm, for merger with Bandhan Bank. Gruh Finance merged with Bandhan Bank on October 17, 2019.

"On de-recognition of investment in Gruh, the corporation has recognised a fair value gain of Rs 9,019.81 crore," HDFC said in a filing to the Bombay Stock Exchange.

The total revenue from operations surged by 92 per cent to Rs 20,285.47 crore in Q3FY20 from Rs 10,575 crore in Q3FY19, the mortgage lender said in a regulatory filing.

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During the quarter under review, net interest income (NII) of the housing finance company rose 13.56 per cent to Rs 2,957.83 crore as against Rs 2,604.57 crore in the same quarter last year. Net interest margin stood at at 3.3 per cent.

In October-December quarter, HDFC made provisions of Rs 2,995 crore compared to Rs 116 crore in the year-ago period and Rs 754 crore in the preceding quarter of this fiscal.

As of 31 December, 2019, the loan book grew by 13 per cent to Rs 4.41 lakh crore compared to Rs 3.89 lakh crore in the year-ago period.

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On the asset front, the gross non-performing loans (GNPAs) were at Rs 5,950 crore, equivalent to 1.36 per cent of the loan portfolio, as on December 31, 2019.

During the quarter under review, HDFC acquired 51.16 per cent of the equity share capital of HDFC ERGO Health Insurance Company (formerly Apollo Munich Health Insurance Company).

The company also informed the exchange that its board has approved issuance of secured redeemable non-convertible debentures (NCDS) aggregating Rs 45,000 crore, in various tranches, on a private placement basis.

Ahead of Q3 results, shares of HDFC closed Monday's trade at Rs 2,395.80 crore, down 2.25 per cent, on the Bombay Stock Exchange.

By Chitranjan Kumar