HDFC Bank has reported a sharp rise in operating income of more than 100% and 76% jump in net profits for the 2QFY01. The bank has again surpassed the market expectations by posting outstanding results. However the current quarter results are not strictly comparable with the corresponding quarter in the previous year due to merger of Times Bank with HDFC Bank effective from February 2000.
Operating Profit (EBDIT)
Operating Profit Margin (%)
Profit before Tax
Profit after Tax/(Loss)
Net profit margin (%)
Diluted number of shares
Diluted Earnings per share*
The remarkable point is that the bank's operating margins have declined by marginal 30 basis points. Again the reason could be attributed to the merger, as Times Bank operating margins were comparatively lower than HDFC Bank.
The merger provided lot of synergies to the bank. Its deposits and customer assets achieved a healthy growth of 155% and 104% respectively during the 1HFY01. Also an increase of 190% in saving account deposits helped the bank in maintaining its operating margins. HDFC Bank enjoys the highest operating margins among the other private sector bank in India mainly because of higher proportion of saving account deposits (14%) to total deposits.
The bank's strong profit growth is driven by an expanded product range, enhanced customer acquisition, geographic expansion and higher level of penetration. The bank provides range of retail products which include loan against shares, auto loans, personal loans and loan for consumer durables. Its NRI business also registered a good growth of 53% to Rs 5 bn during the first half.
At the current market price of Rs 239 HDFC Bank gets a P/E multiple of 30 times its 2QFY01 annualised earnings with a Price/Book value ratio of 7.7 times. The stock has always outperformed the market due to its ability of maintaining the high growth rate both organically and through acquisitions.
HDFC Bank declared the results for the third quarter of financial year ending March 2017 (3QFY17). The bank has reported 18% YoY and 15% YoY growth in net interest income and net profits respectively in 3QFY17.
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