Earnings Alerts

HDFC Bank Earnings Report: 4Q Net Income Misses Estimates Despite Rise in Operating Profit

HDFC Bank‘s net income for the fourth quarter registered at 165.1 billion Rupees. Although it’s a 37% increase from last year, it did not meet the estimated 175.93 billion Rupees

• HDFC’s Gross non-performing assets (NPAs) shrank slightly this quarter from 1.26% to 1.24%

• HDFC’s provisions for this quarter was 135.1 billion rupees, up from 42.2 billion in the previous quarter, surpassing the estimate of 33.22 billion rupees

• The operating profit saw a significant increase of 57% year on year, notably higher than the estimated 243.32 billion rupees, at 292.7 billion rupees

• A dividend of 19.50 rupees will be paid per share

• The bank made an additional floating provision of INR 109B in the fourth quarter

• Despite missing income estimates, the shares of HDFC Bank increased by 2.4% to 1,531 rupees with 17.3 million shares traded

• The bank received 44 buys, 5 holds, and 0 sells from the analyst community


HDFC Bank on Smartkarma

Analysts on Smartkarma have varying sentiments on HDFC Bank. Raj S, CA, CFA initiated coverage with a bearish view, citing near-term negatives post-merger with HDFC Ltd, resulting in a “Short” recommendation for now. Pranav Bhavsar also expressed concerns regarding HDFC Bank‘s earnings, anticipating further challenges ahead.

On the other hand, Value Punks remains bullish on HDFC Bank, emphasizing its blue-chip status and high-quality compounding. Ankit Agrawal, CFA, also maintains a positive outlook, believing in the bank’s ability to sustain growth despite short-term headwinds and merger-related impacts on deposit growth and NIM compression.


A look at HDFC Bank Smart Scores

FactorScoreMagnitude
Value3
Dividend5
Growth3
Resilience2
Momentum2
OVERALL SMART SCORE3.0

Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma

Analysts at Smartkarma have assessed HDFC Bank‘s long-term outlook using their unique Smart Scores. With a stellar Dividend score of 5, HDFC Bank excels in providing attractive returns to its shareholders through regular dividend payouts, showcasing its commitment to investor rewards. The bank also boasts solid scores in Growth and Value at 3, indicating a balanced approach to sustainable growth and maintaining a good value proposition for investors. However, with slightly lower scores in Resilience and Momentum at 2, HDFC Bank may face challenges in terms of navigating market volatility and sustaining upward momentum.

HDFC Bank Ltd., a leading financial institution, offers a diverse array of services catering to the global corporate sector. Providing corporate banking, custodial services, treasury operations, and capital market solutions, HDFC Bank is a comprehensive financial partner for businesses. With a focus on project advisory services and various capital market products, such as Global Deposit Receipts and Euro currency instruments, HDFC Bank demonstrates a commitment to delivering sophisticated financial solutions to its clients.


Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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