HDB Financial Services (HDBFS) investor relations material

Executive summary

• Q1 FY27 saw profit after tax rise 38.3% year-on-year to ₹785 crore, with customer franchise expanding 18.6% to 23.9 million and branch network at 1,710 locations.

• Gross loan book reached ₹1,21,846 crore, up 11.4% year-on-year, with 74% secured loans.

• Disbursements grew 16.2% year-on-year to ₹17,629 crore.

• Asset quality improved, with gross stage three assets at 2.34% (down from 2.56% YoY).

• The company continues to invest in AI-driven transformation, consolidating initiatives under the 'Shikhar' program.

Financial highlights

• Net interest income for Q1 FY27 was ₹2,509 crore, up 19.9% year-on-year; net interest margin rose to 8.35% from 7.74% a year ago.

• Pre-provisioning operating profit reached ₹1,726 crore, up 24.3% year-on-year.

• Cost-to-income ratio improved to 39.9% from 42.7% in Q1 FY26.

• Earnings per share for the quarter was ₹9.5; book value per share stood at ₹256.7.

• Return on assets annualized at 2.5%; ROE annualized at 15%.

Outlook and guidance

• Management expects continued positive momentum in enterprise lending, consumer finance, and asset finance, with growth in disbursements and stable asset quality.

• Credit cost is expected to remain around 2.3%, with potential for improvement if macro conditions are favorable.

• Growth in business loans and asset finance is anticipated to accelerate from Q2/Q3 onwards as recent initiatives take effect.

• Well-capitalized with CRAR at 21.29% as of June 30, 2026.

• Diversified borrowing mix and strong liquidity position support future growth.