HDFC Bank Q3 Review— Inline; Asset Quality Blips Amid Seasonality; Motilal Oswal Retains 'Buy' On The Stock

HDFC Bank reported in-line earnings while margins contracted 3bp QoQ. Deposit growth was strong, while advances growth stood tepid, aligning with the bank’s strategy to reduce the credit-deposit ratio at an accelerated pace..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Motilal Oswal Report.HDFC Bank Ltd. reported Q3 FY25 net profit of Rs 167.4 billion (2.2% YoY growth, in line). Net interest income grew 7.7% YoY to Rs 306.5 billion (in line). Net interest margins contracted 3bp QoQ to 3.43%. Other income stood at Rs 114.5 billion (3% YoY growth, in line). Opex grew 1.3% QoQ, while the C/I ratio stood flat at 40.6%.Provisions declined 25% YoY to Rs 31.5 billion. The bank utilized Rs 3 billion of contingent provisions and holds total provisions (floating and contingent) of Rs 259 billion. Gross non-performing asset/net non-performing asset ratio increased 6bp/5bp QoQ to 1.42%/0.46%, respectively. PCR decreased 207bp QoQ to 67.8%. Fresh slippages stood at Rs 88 billion (however, excl agri, it stood stable at Rs 65 billion). Advances book grew 3% YoY / 1% QoQ to Rs 25.2 trillion; deposits grew 16% YoY /3% QoQ to Rs 25.6 trillion. CD ratio declined to 98.2%, while CASA ratio declined to 34%. We lower our earnings estimate for FY26/27 by 3% each and estimate HDFC Bank to deliver FY26E RoA/RoE of 1.8%/13.9%. Reiterate Buy with a target price of Rs 2,050 (2.3x FY27E ABV plus Rs 294 for subs)..Click on the attachment to read the full report:.HDFC Bank Q3 Results Review — Inline With Contained Credit Costs; Dolat Capital Maintains 'Accumulate'.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

HDFC Bank Q3 Review— Inline; Asset Quality Blips Amid Seasonality; Motilal Oswal Retains 'Buy' On The Stock

The gradual retirement of high-cost borrowings, along with an improvement in operating leverage, will support return ratios over the coming years, says the brokerage.

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HDFC Bank Q3 Review— Inline; Asset Quality Blips Amid Seasonality; Motilal Oswal Retains 'Buy' On The Stock

The gradual retirement of high-cost borrowings, along with an improvement in operating leverage, will support return ratios over the coming years, says the brokerage.

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