HDFC Bank Q4 Results Preview: Profit Seen Higher, NIMs To Stay Under Pressure

HDFC Bank is expected to report higher profit in the March quarter, supported by growth in net interest income and steady asset quality, even as net interest margins remain under pressure from policy rate transmission. The company is scheduled to announce its fourth quarter results on April 18.

Bloomberg estimates indicate net interest income may rise 4.9% year-on-year, while profit is seen up 8%. Provisions are expected to increase 7.9%, while net interest margin is seen moderating to 3.39% from 3.46%.

The key questions this quarter are whether deposit growth remains strong enough to support faster loan expansion, how quickly net interest margins can stabilise after rate-cut transmission, and whether asset quality stays benign after elevated agricultural slippages in the previous quarter. Commentary on growth priorities after the recent chairman transition will also be closely watched.

HDFC Bank Q4 Results Preview (Standalone, YoY, Bloomberg Estimates)

• Net interest income seen 4.9% higher at Rs 33,665.77 crore versus Rs 32,070
• Provisions seen 7.9% higher at Rs 3,448.35 crore versus Rs 3,193.05 crore
• Gross NPA seen at 1.2% versus 1.24% (QoQ)
• Net interest margin seen at 3.39% versus 3.46%
• Profit seen 8% higher at Rs 19,013 crore versus Rs 17,616 crore

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Here's what analysts are expecting from HDFC Bank Q4 results:

Nomura

• Deposit and loan growth reported as strong, though loan growth still trails system credit growth.
• Asset quality expected to remain steady.
• NIM expected to decline by around four basis points quarter-on-quarter due to repo rate transmission, partly offset by term deposit repricing and the cash reserve ratio cut.
• Key watchpoints include margins, loan and deposit growth, liquidity coverage ratio and commentary after the chairman exit.

Systematix Research

• Sequential growth in advances expected to remain healthy, though lower than industry growth.
• Fall in asset yields may not be fully offset by lower cost of deposits, leading to marginal sequential pressure on NIM.
• Fee income expected to grow broadly in line with advances, while other income may decline.
• Operating expenses expected to soften sequentially, with lower employee costs.
• Slippages and provisions likely to rise modestly quarter-on-quarter.

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Antique Stock Broking

• Net interest income expected to grow 7% year-on-year and 5% quarter-on-quarter.
• NIM expected to improve marginally due to lower funding costs.
• Fee income growth expected to remain healthy.
• Operating expense growth seen lower after a prior-quarter impact from labour code changes.
• Slippage ratio expected to decline sequentially after elevated agricultural slippages in the previous quarter.
• Profit expected to rise 8% year-on-year, with return on assets broadly stable.

Kotak Securities

• Loan growth expected near industry average, while deposits growth remains strong.
• Credit-deposit ratio has declined, reflecting efforts to normalise balance sheet metrics.
• NIM expected to remain stable in the quarter.
• Gross non-performing loan ratio expected to remain stable, with steady slippages.
• Near-term focus on the pace of NIM recovery and growth outlook.

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