HDFC - Defying competition, individual loan growth robust - Edelweiss

Defying concerns of intensifying competition in the individual home loan space, HDFC once again reported a robust individual loan growth in Q3FY13—up 25% YoY (31% adjusting for sell-downs to HDFC Bank) and 6% QoQ. PAT at INR11.4bn, was up 16% YoY, in line with expectations.

While NII, including surplus from investment in MFs, grew 24% YoY, PAT was lower due to 30% decline in non-interest income (lower fee income, dividend income and investment profits). We expect this trend to continue and while the core mortgage business will likely clock 20%+ YoY growth, slower traction in other revenue streams at ~4-5% will lead to PAT increase of 17% for FY13E (refer Table 1).

Maintain 'Hold'.

Source : Equity Bulls

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