Monday 13 May 2019

HDFC to announce Q4 result today; here's what you should watch out for


Housing finance company HDFC is scheduled to announce with its March quarter earnings on May 13.

Research and broking firm Motilal Oswal expects HDFC to report a net profit of Rs 2,374 crore. Net Sales are expected at Rs 2,900.3 crore, the report added.

The numbers are not comparable on a YoY basis as the company will be giving out results with a different accountancy standard (IndAS).

Earnings before interest, tax, depreciation and amortisation (EBITDA) is likely to fall by 14.7 percent Y-o-Y (down 9.1 percent Q-o-Q) to Rs 2,595.3 crore.

According to a CNBC-TV18 Poll, net interest income is seen at Rs 3,079.3 crore against Rs 3,001.8 crore in the corresponding quarter of the previous year. On the other hand, net profit is seen at Rs 2,576.2 crore against Rs 2,846.2 crore.

Emkay Global Financial Services expects HDFC’s loan growth to remain healthy at ~17 percent backed by increasing market share in individual loans. The trend in sanctions in the affordable housing segment will continue to be crucial for future growth trends.

Asset quality is likely to remain stable but management commentary on developer portfolio will be a key monitorable, it added.

Research firm Narnolia is of the view that NII is expected to grow at 9 percent QoQ in 4QFY19 driven by margin expansion. AUM growth is expected to still remain under pressure with 16 percent in 4QFY19 driven by individual segment.

NIM is expected to expand in 4QFY19, driven by fall in marginal cost of borrowing by 20-30 bps while Management has altogether taken 70 bps hike in PLR from April which will help in margin expansion. Other Income is expected to decline as dividend income from HDFCAMC has declined to Rs 12 dividend per share against Rs 16 last year, the research firm added.

Key things to watch:

Stability in NIM will be positive

AUM growth could come down to 14-15 percent

GNPA below 1.25 percent will be positive for the company

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