India’s largest private sector lender, HDFC Bank, has announced its financial results for the third quarter of FY25, reporting a 2.2% year-on-year (YoY) increase in standalone net profit to ₹16,736 crore.
The bank’s net interest income (NII), a critical indicator of profitability, rose by 8% YoY to ₹30,690 crore, meeting projections. Despite a rise in Non-Performing Assets (NPAs) and NPA ratios, HDFC Bank demonstrated steady growth in its core earnings, reflected in both NII and net profit figures.
The stock market reacted positively to the results, with HDFC Bank shares rebounding from intraday lows to close in the green, lifting benchmark indices. Following the Q3 announcement, the stock gained 1.3% and was trading at ₹1,664 on the NSE.
Q3 Highlights and Outlook
The results highlight HDFC Bank’s ability to integrate synergies post-merger with HDFC Ltd., which has positioned it as a financial services giant. Analysts remain optimistic about the bank’s long-term prospects, with 40 brokerage firms recommending a “buy” rating. Investors are closely monitoring the bank’s strategies to navigate competitive and evolving market conditions.
The merger with HDFC Ltd. is expected to unlock significant advantages in underwriting, operations, and product offerings. However, Q3 results may also shed light on challenges, such as seasonal slowdowns in deposit accretion, normalization of credit costs, and increased slippages in the agriculture portfolio.
In the previous quarter (Q2 FY25), HDFC Bank posted a standalone net profit of ₹16,820 crore, a 5.3% YoY increase, with total income rising 9% YoY to ₹85,499 crore. Ahead of the Q3 earnings release, HDFC Bank shares were up 0.62% intraday, trading at ₹1,652.
The latest financial results reaffirm HDFC Bank’s resilience and ability to capitalize on growth opportunities despite sectoral challenges.
Sharekhan projects HDFC Bank’s Q3 net profit at ₹16,264 crore, marking a 0.7% year-on-year (YoY) decline. The brokerage anticipates net interest income (NII) to rise by 7.9% YoY to ₹30,727 crore, with asset quality expected to remain stable. Net interest margins (NIM) are projected to remain flat sequentially. Key aspects to watch include NIM progress and the outlook for loan and deposit growth, Sharekhan noted.
Motilal Oswal Financial Services (MOFSL) estimates HDFC Bank’s net profit at ₹16,644 crore, reflecting a 1.7% YoY increase. It expects NII to grow by 6.5% YoY to ₹30,335 crore, with cost ratios likely to remain controlled and margins broadly stable.
Nuvama predicts HDFC Bank’s NIM at 3.43% for Q3, down from 3.46% in Q2. It forecasts a 3.2% YoY increase in profit to ₹16,900 crore, with NII rising 7.4% YoY to ₹30,570 crore. Slippages are estimated at ₹8,200 crore, with slippages as a percentage of lagged loans at 1.32%. Credit costs are expected to amount to 0.45% of total loans.
These projections highlight a broadly stable performance for HDFC Bank, with analysts closely monitoring margin trends and asset quality metrics in a challenging economic environment.
