HDFC BANK -Q2 FY 21 - RESULTS REVIEW -DT 18 10 2020

 

HDFC BANK

Q2 FY 21 RESULTS REVIEW

DT 18 10 2020

 

COMPANY OVERVIEW

HDFC Bank Ltd has three key business segments:

Wholesale Banking Services - The Bank`s target market ranges from large, blue-chip manufacturing companies in the Indian corporate to small & mid-sized corporates and agri-based businesses.

Retail Banking Services - The objective of the Retail Bank is to provide its target market customers a full range of financial products and banking services, giving the customer a one-stop window for all his/her banking requirements.

Treasury - Within this business, the bank has three main product areas - Foreign Exchange and Derivatives, Local Currency Money Market & Debt Securities, and Equities. The Treasury business is responsible for managing the returns and market risk on this investment portfolio.

The services offered by the bank include

Personal Banking:Accounts & Deposits, Loans, Cards, Forex,Investments & Insurance.

NRI Banking: Accounts & Deposits, Remittances & Investments & Insurance Loans Payment Services.

Wholesale Banking: Corporate, Small & Medium Enterprises, Financial Institutions & Trusts & Government Sector.

HDFC Bank was the first bank in India to launch an International Debit Card in association with VISA (VISA Electron) and issues the Mastercard Maestro debit card as well

MANAGEMENT

Shyamala Gopinath            Chairperson

Aditya Puri    Managing Director (Now Sasidharan Jagadisan)

Kaizad Bharucha         Executive Director

QUARTERLY RESULTS

 

HDFC Bank (in Rs. Cr.)	Jun '20	Mar '20	Jun '19	YOY	QOQ
Interest Earned
(a) Int. /Disc. on Adv/Bills	25,978.00	25,919.24	23,560.50	10.26	0.23
(b) Income on Investment	5,599.41	5,075.57	5,250.42	6.65	10.32
(c) Int. on balances With RBI	641.58	641.28	183.19	250.23	0.05
(d) Others	132.62	158.96	182.34	-27.27	-16.57
Other Income	4,346.98	6,492.12	5,148.00	-15.56	-33.04
EXPENDITURE
Interest Expended	15,608.49	15,528.57	14,977.15	4.22	0.51
Employees Cost	3,301.00	3,376.84	3,017.45	9.4	-2.25
Other Expenses	4,105.08	5,483.40	4,580.68	-10.38	-25.14
Operating Profit before Provisions and contingencies	13,684.02	13,898.36	11,749.17	16.47	-1.54
Provisions And Contingencies	4,344.51	4,216.50	2,914.34	49.07	3.04
P/L Before Tax	9,339.51	9,681.86	8,834.83	5.71	-3.54
Tax	2,398.63	2,385.15	3,144.03	-23.71	0.57
P/L After Tax from Ordinary Activities	6,940.88	7,296.71	5,690.80	21.97	-4.88
Net Profit/(Loss) For the Period	6,940.88	7,296.71	5,690.80	21.97	-4.88
Share Of P/L Of Associates	-13.64	-16.49	-14.74	-7.46	-17.28
Net P/L After M.I & Associates	6,927.24	7,280.22	5,676.06	22.04	-4.85
Equity Share Capital	549.03	548.33	546.56	0.45	0.13
EPS After Extra Ordinary
Basic EPS.	12.6	13.3	20.8	-39.42	-5.26
Diluted EPS.	12.6	13.2	20.6	-38.83	-4.55
NPA Ratios :
i) Gross NPA	13,773.46	12,649.97	11,768.95	17.03	8.88
ii) Net NPA	3,279.96	3,542.36	3,567.18	-8.05	-7.41
i) % of Gross NPA	1.36	1.26	1.4	-2.86	7.94
ii) % of Net NPA	0.33	0.36	0.43	-23.26	-8.33
MP	1199.35
PE	23.796627
VOLUMES	1,29,11,559

 

52 Wk L/H     738.9     1304.1

ANNUAL RESULTS

Annual	Mar-20	Mar-19	Mar-18	Mar-17	Mar-16
Interest Earned	1,22,189	1,05,160	85,287	73,271	63,161
Other Income	24,878	18,947	16,056	12,877	11,211
Total Income	1,47,068	1,24,107	1,01,344	86,148	74,373
Total Expenditure	95,173	81,407	66,308	58,792	51,901
Operating Profit	51,894	42,700	35,035	27,356	22,471
Provisions & Contigencies	13,699	8,382	6,571	3,990	2,960
PBT	38,194	34,318	28,463	23,365	19,511
Tax	10,898	11,872	9,903	8,078	6,693
Net Profit	27,296	22,445	18,560	15,287	12,817
NPA
Gross NPA	12,649	11,224	8,606	5,885	4,392
Gross NPA (%)	1	1	1	1	1
Net NPA	3,542	3,214	2,601	1,843	1,320
Net NPA (%)	0.36	0	0	0	0
	Mar-20	Mar-19	Mar-18	Mar-17	Mar-16
Operating Activities	-16,869	-62,871	17,214	17,281	-7,676
Investing Activities	-1,616	-1,598	-852	-1,147	-865
Financing Activities	24,394	23,130	57,377	-5,892	11,056
Others	213	95	10	-28	28
Net Cash Flow	6,122	-41,243	73,750	10,212	2,542

 

Per Share Ratios	Mar-20	Mar-19	Mar-18	Mar-17	Mar-16
Basic EPS (Rs.)	49.84	83.33	71.73	59.95	50.85
Diluted Eps (Rs.)	49.46	82.51	70.76	59.16	50.24
Book Value [Excl. Reval Reserve]/Share (Rs.)	321.63	564.29	422.33	358.21	293.9
Dividend/Share (Rs.)	2.5	15	13	11	9.5
Face Value	1	2	2	2	2
Margin Ratios	Mar-20	Mar-19	Mar-18	Mar-17	Mar-16
Net Interest Margin (%)	3.79	3.97	3.88	3.94	3.98
Operating Profit Margin (%)	1.97	3.32	2.93	3.28	2.54
Net Profit Margin (%)	22.33	21.34	21.76	20.86	20.29
Return Ratios	Mar-20	Mar-19	Mar-18	Mar-17	Mar-16
Return on Networth / Equity (%)	15.45	14.53	16.88	16.61	17.22
ROCE (%)	3.43	3.45	3.32	3.28	3.24
Return On Assets (%)	1.72	1.72	1.67	1.7	1.75
Valuation Ratios	Mar-20	Mar-19	Mar-18	Mar-17	Mar-16
P/E (x)	0	3.85	3.48	4.89	3.82
P/B (x)	2.68	4.11	4.48	4.03	3.64
Other Ratios	Mar-20	Mar-19	Mar-18	Mar-17	Mar-16
CASA (%)	42.18	42.35	43.48	48.03	43.26
Capital Adequacy Ratios (%)	19	17	15	15	16

 

Historical Prices
	3yr bef	Current Price	%Gain / Loss
Open Price	927.78	1182	27.4
	2YR BEF
Open Price	1005	1182	17.61
	1YR BEF
Open Price	1234.7	1182	-4.27
	3M BEF
Open Price	1052.7	1182	12.28

 

Dividend Summary

For the year ending March 2020 HDFC Bank has declared an equity dividend of 250.00% amounting to Rs 2.5 per share. At the current share price of Rs 1199.35 this results in a dividend yield of 0.21%.

The company has a good dividend track report and has consistently declared dividends for the last 5 years.

Share Holding Pattern in (%)
Standalone	Jun-20	Mar-20	Dec-19	Sep-19
Promoters	26.1	26.14	26.18	26.21
Pledged	0	0	0	0
FII/FPI	37.04	36.68	37.92	37.64
Total DII	25.89	25.89	24.75	24.98
Fin.Insts	0.08	0.12	0.1	0.1
Insurance Co	3.78	3.31	2.97	2.88
MF	14.04	15.01	14.38	14.41
Others DIIs	7.99	7.45	7.3	7.59
Others	10.99	11.3	11.15	11.17
Total	100.02	100.01	100	100

 

Valuation

Market Cap (Rs Cr.)    6,59,894.13

P/E                      24.14

Book Value (Rs)   310.68

Dividend (%)       250

Industry P/E         27.37

EPS (TTM)            49.69

P/C                      23.13

Price/Book           3.86

Dividend Yield.(%)      0.21

Face Value (RS)          1

Deliverables (%)        45.5

Aditya Puri hangs up boots with a good quarter .

Clearly and expectedly, the COVID-19 pandemic has impacted the business. While there has been some improvement in economic activities during the current quarter, the continued slowdown has led to a decrease in loan originations, the sale of third-party products, the use of credit and debit cards, and the efficiency in collection efforts, the bank said.

“The slowdown may lead to a rise in the number of customer defaults and consequently an increase in provisions,” said the bank.

Loan growth tilts to wholesale : 

A look at the loan growth data of the bank in the quarter shows a strong focus on the wholesale book.

The lender has taken adequate precaution against the likely impact on the books on account of the pandemic.

Managing Director Aditya Puri is handing over the charge to Sashidhar Jagdishan  shortly.