HDFC Bank, one of India's leading private sector lenders, has reported a notable increase in its net profit for the fourth quarter of the financial year 2024-25. The bank's net profit surged by 6.7% year-on-year, amounting to Rs 17,616 crore, reflecting strong operational performance amidst a dynamic economic landscape.
According to the bank's financial results released on April 19, 2025, its net interest margin (NIM) stood at 3.54% on total assets and 3.73% based on interest-earning assets. Excluding Rs 700 crore of interest on income tax refunds, the core NIM was reported at 3.46% on total assets and 3.65% on interest-earning assets. This performance highlights the bank's ability to effectively manage its interest income amid fluctuating market conditions.
In addition to the impressive profit figures, HDFC Bank declared a dividend of Rs 22 per share for its shareholders, signaling a commitment to returning value to investors. The bank's net revenue for the quarter reached Rs 44,090 crore, down from Rs 47,240 crore in the same period last year. However, the decline in revenue was offset by a significant reduction in provisions and contingencies, which fell sharply to Rs 3,190 crore from Rs 13,510 crore a year earlier. The previous year's figures included floating provisions of Rs 10,900 crore, which contributed to the stark contrast in this year's results.
HDFC Bank's deposit base also saw robust growth, with average deposits rising 15.8% year-on-year to Rs 25.28 lakh crore, compared to Rs 21.83 lakh crore last year. The bank's average CASA (current account savings account) deposits stood at Rs 8.29 lakh crore, reflecting a 5.7% increase from the previous year. This growth in deposits underscores the bank's strong customer trust and preference for its banking services.
As of March 31, 2025, HDFC Bank's gross advances reached Rs 26.43 lakh crore, marking a 5.4% increase from Rs 25.08 lakh crore a year earlier. Notably, retail loans grew by 9% year-on-year, while commercial and rural banking loans experienced a significant increase of 12.8%. However, corporate and other wholesale loans saw a decline of 3.6%, which moderated the overall loan growth.
In terms of asset quality, the bank reported gross non-performing assets (GNPAs) at 1.33% of gross advances, slightly up from 1.24% a year earlier, but an improvement from 1.42% in the December 2024 quarter. Net NPAs were reported at 0.43% of net advances. These figures indicate that while there has been a slight deterioration in asset quality, the bank continues to maintain a strong position relative to industry standards.
HDFC Bank's capital adequacy ratio (CAR) stood at 19.6% as of March 31, 2025, up from 18.8% a year earlier, demonstrating the bank's robust capital position and compliance with regulatory requirements.
In a broader context, HDFC Bank and ICICI Bank, another major player in the Indian banking sector, were both set to announce their financial results on the same day. As of March 31, 2025, ICICI Bank was expected to report strong earnings, with brokerages projecting a net profit increase of 10-15% year-on-year. Estimates for ICICI Bank's Q4 profit ranged between Rs 11,822 crore and Rs 12,350 crore, alongside an anticipated rise in net interest income by 7.6-11%.
Fitch Ratings recently upgraded ICICI Bank’s asset quality score from ‘BB-’ to ‘BB’, indicating improved performance in managing impaired loans. The agency's outlook for ICICI Bank was revised from positive to stable, reflecting a balanced approach to growth in both loans and deposits.
Investors are keenly observing the financial results of both banks amid evolving credit trends and a dynamic economic environment. HDFC Bank's solid performance in the fourth quarter reflects its resilience and adaptability in a competitive landscape.
Overall, HDFC Bank's results for Q4FY25 highlight a strong operational foundation, even as it navigates challenges in the banking sector. The combination of rising profits, a healthy dividend announcement, and solid growth in deposits positions the bank favorably for future growth.
As the financial landscape continues to evolve, HDFC Bank's strategic initiatives and focus on customer satisfaction will be crucial in maintaining its leading position in the market. With a commitment to enhancing shareholder value, the bank is poised to leverage its strengths to achieve sustainable growth in the coming years.
