Result date: April 20, 2024
Recommendation: Buy
Target price: ₹1,780
HDFC Bank witnessed lower-than-expected sequential growth in loans at 1.6%. Growth in deposits and CASA though was strong at 7.5% and 8.7%, respectively on a sequential basis. The bank’s LDR reduced by ~600 basis points from 111.5% in Q3FY24 to 105.4% in 4QFY24. Analysts at IIFL Securities expect the bank’s Net Interest Income (NII) to inch up by 1% sequentially and Total Income to grow 2% over the December 2023 quarter.
The Bank’s Net Interest Margin (NIM) could decline by 5 basis points sequentially due to the sharp decline in LDR. Pre-provisioning operating profit (PPOP) is expected to remain flat sequentially due to lower NII growth.
Profit After Tax (PAT) could decline 5% over the December 2023 quarter.
₹ Billion | March 2024 estimates | QoQ change | YoY change |
Loans | 25,080 | 3% | 57% |
Deposits | 23,808 | 8% | 26% |
Net Interest Income (NII) | 287.4 | 1% | 23% |
Total Income | 403.2 | 2% | 26% |
PPOP | 237.5 | 0% | 28% |
Profit After Tax | 154.9 | (5)% | 29% |
Source: IIFL Research
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