Housing Development Finance (HDFC) Q4 18/19 earnings summary

Executive summary

• FY19 growth was led by individual home loans and volume; tighter liquidity and rising corporate-sector risks prompted more selective non-individual lending.

• Consolidated profit after tax rose 34% to ₹17,581 crore; standalone reported PAT was ₹9,632 crore, with prior-year stake-sale gains limiting comparability.

Financial highlights

• Standalone total income was ₹43,378 crore vs ₹40,707 crore; PBT was ₹13,119 crore vs ₹13,190 crore and PAT ₹9,632 crore vs ₹10,959 crore.

• Adjusted for investment-sale gains and loan-loss provisions, standalone profit before sale of investments and provisions grew 32% to ₹12,841 crore from ₹9,696 crore.

• Consolidated revenue was ₹96,195 crore vs ₹79,820 crore; PBT ₹22,099 crore vs ₹16,207 crore and PAT ₹17,581 crore vs ₹13,111 crore.

• Consolidated profit attributable to owners was ₹16,232 crore vs ₹11,980 crore; basic EPS was ₹95.40 vs ₹74.77.

• Standalone investment-sale profit fell to ₹1,212 crore from ₹5,609 crore; FY18 included HDFC Life stake-sale gains, making reported income and profit comparisons less comparable.

Outlook and guidance

• Housing finance demand is expected to remain robust, supported by housing shortages, low mortgage penetration, urbanisation, improved affordability, fiscal incentives and a young demographic.

• Retail home-loan growth and asset quality remained the positive focus; management said growth was volume-led, with deeper market penetration and stronger affordable-home supply.

• Continued support for the government’s Housing for All mission and Credit Linked Subsidy Scheme; more than 100,000 customers had benefited from CLSS.