HDFC Bank Q4 Review - Stable Quarter But Overhang Of RBI Ban Continues: Dolat Capital

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Dolat Capital Report

HDFC Bank Ltd. reported in-line NII and PPoP growth of 13% and 20% YoY respectively.

PAT growth at 18% was impacted by higher contingent provisions of Rs 13 billion, including Rs 5 billion towards compound interest waiver.

Annualised slippages trended lower and were in line with expectations at 1.66% (ex of pro forma slippages in previous quarters).

The bank added another Rs 8 billion to its standard provisioning buffers, which continue to stand at over 0.6% of advances. Restructured portfolio stood at 0.6% of loans.

NIM at 4.2% was tad below expectations led by sequentially higher investment book and surplus liquidity, even as improved cost of funds aided NIM.

Lack of clarity over the timeline of RBI embargo on digital launches and new credit card issuance remains a key overhang over the near term.

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