{"id":157757,"date":"2024-01-17T06:12:58","date_gmt":"2024-01-17T11:12:58","guid":{"rendered":"https:\/\/44.250.171.167\/?p=157757"},"modified":"2024-01-17T06:13:00","modified_gmt":"2024-01-17T11:13:00","slug":"hdfc-bank-limited-q3-fy24-earnings-conference-call-insights","status":"publish","type":"post","link":"https:\/\/alphastreet.com\/india\/hdfc-bank-limited-q3-fy24-earnings-conference-call-insights\/","title":{"rendered":"HDFC Bank Limited Q3 FY24 Earnings Conference Call Insights"},"content":{"rendered":"<p><strong>Key highlights from HDFC Bank Limited (HDFCBANK) Q3 FY24 Earnings Concall<\/strong><\/p>\n<ul>\n<li><strong>Healthy Domestic Economic Activity<\/strong>\n<ul>\n<li>Domestic activity driven by robust consumer spending, capital expenditure, manufacturing, and services sector.<\/li>\n<li>GST collections grew 13% year-over-year.<\/li>\n<li>Manufacturing and services PMI in expansionary zone.<\/li>\n<li>Consumer demand improved due to festive spending.<\/li>\n<li>GDP growth estimate 7% for FY 2024 and 6.5% for FY 2025.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Deposit Growth<\/strong>\n<ul>\n<li>Total deposits at INR 22.1 trillion, 84% retail deposits.<\/li>\n<li>Retail deposits grew 2.9% quarter-over-quarter.<\/li>\n<li>Current account deposits grew 3.2% sequentially.<\/li>\n<li>Savings deposits grew 1.7% sequentially.<\/li>\n<li>CASA ratio at 37.7%.<\/li>\n<li>Term deposits grew 1.7% during the quarter<\/li>\n<\/ul>\n<\/li>\n<li><strong>Asset Quality<\/strong>\n<ul>\n<li>GNPA ratio at 1.26% vs 1.34% last quarter.<\/li>\n<li>Core GNPA ratio at 1.11%, while net NPA ratio at 0.31% vs 0.35% last quarter.<\/li>\n<li>Quarterly slippage ratio at 26 bps and recoveries and upgrades at INR 45 billion.<\/li>\n<li>Provision coverage ratio at 75%.<\/li>\n<li>HDBFS Gross stage 3 loans down to 2.25% from 3.73% last year.<\/li>\n<li>Stage 3 provision coverage increased to 68% for HDBFS.<\/li>\n<li>HDBFS\u2019s quarterly profit after tax up to INR 6.4 billion.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Subsidiaries Growth<\/strong>\n<ul>\n<li>HDFC Life profit grew 16% year-over-year.<\/li>\n<li>HDFC AMC quarterly AUM up 24% to INR 5.5 trillion.<\/li>\n<li>HDFC AMC profit grew 33% year-over-year.<\/li>\n<li>HDFC ERGO profit grew 6% year-over-year.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Profitability<\/strong>\n<ul>\n<li>Quarterly profit before tax up 19.8%.<\/li>\n<li>Quarterly net profit up 33.5% year-over-year.<\/li>\n<li>Return on assets about 2% and Return on equity 15.8%.<\/li>\n<li>Earnings per share INR 21.6 standalone, INR 22.7 consolidated.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Deposit Growth Constraints<\/strong>\n<ul>\n<li>System liquidity turned negative for the first time in 3 years.<\/li>\n<li>Retail deposits grew 2.9% but non-retail declined 3.3%.<\/li>\n<li>Bank chose not to participate in higher deposit pricing war.<\/li>\n<li>Lack of liquidity and high sensitivity to rates constrained growth.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Liquidity and CD Ratio Management<\/strong>\n<ul>\n<li>Funded INR1.15 trillion loans through lower investments and cash.<\/li>\n<li>Loan-to-deposit ratio increased to over 110%.<\/li>\n<li>Current and savings account growth reasonably healthy.<\/li>\n<li>Need more customer acquisitions to drive deposit growth.<\/li>\n<li>Target LCR between 110-120%, currently at 110%.<\/li>\n<li>LDR elevated due to merger, target to reduce over time.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Margin Expansion Plans<\/strong>\n<ul>\n<li>Enhance retail loan mix which has higher margins.<\/li>\n<li>Accelerate growth in personal loans and mortgages.<\/li>\n<li>Improve CASA ratio from current 37.7% to historical 42-43%.<\/li>\n<li>Replace some borrowings with retail deposits over time.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Cost Efficiency Roadmap<\/strong>\n<ul>\n<li>Target to reduce cost-to-income ratio from 40% to mid-30s.<\/li>\n<li>Drive efficiency through technology and digital initiatives.<\/li>\n<li>Grow revenue faster than costs to improve ratio.<\/li>\n<li>Maintaining transparency on ask rates for next quarter.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Scaling Distribution Network<\/strong>\n<ul>\n<li>Added 290 branches year-to-date, will likely fall short of 1,500 target.<\/li>\n<li>Have over 500 branches in pipeline to end year with 800-1,000.<\/li>\n<li>Long term goal remains 13,000-14,000 branches for coverage.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Key highlights from HDFC Bank Limited (HDFCBANK) Q3 FY24 Earnings Concall Healthy Domestic Economic Activity Domestic activity driven by robust consumer spending, capital expenditure, manufacturing, and services sector. GST collections grew 13% year-over-year. Manufacturing and services PMI in expansionary zone. Consumer demand improved due to festive spending. GDP growth estimate 7% for FY 2024 and [&hellip;]<\/p>\n","protected":false},"author":1767,"featured_media":154818,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[9825,392,1],"tags":[151,10169,1792],"class_list":["post-157757","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-earnings-call-highlights","category-earnings","category-finance-stocks","tag-banking","tag-earnings","tag-financial-services"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/alphastreet.com\/india\/wp-content\/uploads\/2023\/10\/CC_Image_1.jpg","jetpack_likes_enabled":false,"jetpack-related-posts":[{"id":154951,"url":"https:\/\/alphastreet.com\/india\/hdfc-bank-limited-q2-fy24-earnings-conference-call-insights\/","url_meta":{"origin":157757,"position":0},"title":"HDFC Bank Limited Q2 FY24 Earnings Conference Call Insights","author":"Praveen","date":"October 16, 2023","format":false,"excerpt":"Key highlights from HDFC Bank Limited (HDFCBANK) Q2 FY24 Earnings Concall Merger With HDFC Limited Incremental liquidity and CRR requirements post-merger had a 25 bps impact on NIMs. HDFC Ltd\u2019s non-retail book saw a slight increase in NPAs due to the restructuring of one account, but this will not significantly\u2026","rel":"","context":"In &quot;Concall Highlights&quot;","block_context":{"text":"Concall Highlights","link":"https:\/\/alphastreet.com\/india\/category\/earnings-call-highlights\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/10\/CC_Image_1.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/10\/CC_Image_1.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/10\/CC_Image_1.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/10\/CC_Image_1.jpg?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":128144,"url":"https:\/\/alphastreet.com\/india\/hdfc-bank-q3-fy-22-research-tear-sheet\/","url_meta":{"origin":157757,"position":1},"title":"HDFC Bank Q3 FY 22 Research Tear Sheet","author":"sreerupa","date":"March 7, 2022","format":false,"excerpt":"HDFC Bank Limited\u00a0is an Indian banking and financial services company. 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