India’s largest private sector lender HDFC bank The results for the January-March quarter will be announced tomorrow. Investors will wait patiently for the quarterly performance of the bank, which has a market share of 11%, which is second only to state Bank of India ,State Bank Of IndiaThe lender expects strong growth in profits with various analysts expecting a year-on-year growth of 18-30%. Provisions are likely to decrease and credit is expected to increase. HDFC Bank’s results will also be watched as the lender proposes to merge with Housing Development Finance Corporation (HDFC) – A move that is likely to increase the bank’s market share.
net profit expectations
Motilal Oswal: Rs 9,690 crore
18.4% on-year growth; down 6.2% sequentially
Edelweiss: Rs 10,183 crore
up 24% from last year; down 2% on a quarterly basis
Axis Securities: Rs 10,378 crore
up 26.8% year-on-year; 0.3% increase from the previous quarter
Kotak Securities: Rs 10,478.20 crore
up 19% year-on-year; Growth of 1.3% sequentially
yes security: Rs 11,298.10 crore
38% on-year and up 9.2% from last quarter
Net Interest Income Expectations
Motilal Oswal: Rs 19,380 crore
Growth of 13.2% Y.Y. and 5% Y.Y.
Axis Securities: Rs 19,458 crore
Up 13.7% y-o-y and 5.5% y-o-y
Edelweiss: Rs 19,550 crore
14% year-on-year and up 6% from the previous quarter
Yes Security: 19, 636.80 crore
14.7% year-on-year growth and 6.5% quarterly growth
Kotak Securities: 19,776 crore
Growth of 15.5% Y.Y. and 7.2% Y.Y.
provisioning requirements
Kotak Securities: Rs 3,134.90; 33.2% less than last year
Axis Securities: Rs 3,795 crore; down 19.1% year-on-year
edelweiss: Rs 3,300 crore; 21% down on a yearly basis
what to look for
HDFC Bank will be the first among the major lenders to report its quarterly earnings. Analysts at Motilal Oswal said HDFC Bank’s comments around credit card and fee income traction is a major watchdog. Meanwhile, analysts at Axis Securities are looking at HDFC Bank’s growth outlook on each segment along with commentary on the credit card segment. The loan book of the lender has reached Rs 13.69 lakh crore in the January-March quarter.
Management’s comments on the proposed merger will be important. According to S&P Global, the merger of HDFC and HDFC Bank is expected to diversify the bank’s business profile. “The combined entity’s earnings may improve in the next three to five years. This merger will provide the bank with a profitable cross-selling opportunity for HDFC Ltd’s large group of customers, especially high-yield products such as unsecured loans. It will also generate more fee income from insurance and investment products,” he said earlier last week.
HDFC Bank remains ‘Buy’ call for Motilal Oswal, Edelweiss and Axis Securities.