Srinagar, July 21, KNT: HDFC Bank Limited reported a robust financial performance for the quarter ended June 30, 2025, with significant growth in both revenue and profitability. The bank posted a standalone net profit of ₹181.6 billion for the quarter, marking a 12.2% increase over the corresponding period last year. Consolidated net profit stood at ₹162.6 billion. The stellar performance was supported by strong core operating metrics and exceptional one-time gains from the partial divestment of its subsidiary HDB Financial Services Ltd.
The bank’s total net revenue during the quarter stood at ₹531.7 billion, up from ₹405.1 billion in Q1 FY25. A major boost came from ₹91.3 billion in transaction gains arising from the offer-for-sale in the HDB Financial Services IPO. Net interest income rose 5.4% year-on-year to ₹314.4 billion. The core net interest margin, however, moderated slightly to 3.35% from 3.46% in the previous quarter, reflecting faster repricing of assets compared to deposits.
Other income (non-interest revenue) surged to ₹217.3 billion, driven by gains in trading and mark-to-market transactions, improved fee income, and higher earnings from forex and derivatives. Operating expenses increased moderately to ₹174.3 billion. Excluding the IPO gains, the bank’s cost-to-income ratio stood at 39.6%.
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HDFC Bank significantly enhanced its provisioning buffers during the quarter, with total provisions and contingencies amounting to ₹144.4 billion—much higher than ₹26 billion a year ago. This includes ₹90 billion in floating provisions and ₹17 billion in additional contingent provisions, strengthening the bank’s balance sheet against future credit risks. Despite this, the bank’s credit performance remained stable, aided by a benign credit environment.
On the balance sheet front, HDFC Bank’s total assets stood at ₹39,541 billion, an increase from ₹35,672 billion in the same quarter last year. End-of-period deposits grew 16.2% to ₹27,641 billion. Within this, CASA deposits rose 8.5%, though their share in total deposits declined to 33.9%, primarily due to stronger growth in term deposits. Advances stood at ₹26,532 billion, reflecting a 6.7% year-on-year growth, with healthy momentum in retail and SME lending.
Asset quality remained largely stable. Gross non-performing assets (GNPA) stood at 1.40% of gross advances, compared to 1.33% a year ago. Excluding the agricultural segment, GNPA was 1.14%. Net NPAs were at 0.47%.
The bank’s capital adequacy ratio (CAR) under Basel III norms was a strong 19.9%, well above the regulatory requirement. Tier 1 capital ratio stood at 17.8%, with a Common Equity Tier 1 ratio of 17.4%, underscoring the bank’s strong capital position.
In a move welcomed by investors, the Board of Directors declared a special interim dividend of ₹5 per share and approved a 1:1 bonus issue, subject to regulatory and shareholder approvals.
The bank’s distribution network continues to expand, now comprising 9,499 branches and 21,251 ATMs across 4,153 cities and towns, with over half of the branches located in semi-urban and rural areas. The workforce also saw a year-on-year increase, reaching 2,18,822 employees.
Among its key subsidiaries, HDB Financial Services recorded a net profit of ₹5.7 billion, while HDFC Life Insurance posted a PAT of ₹5.5 billion, up 14.4% year-on-year. HDFC ERGO General Insurance saw PAT rise by 56.4% to ₹2.1 billion. HDFC AMC, with average assets under management of ₹8,286 billion, registered a profit of ₹7.5 billion, a 23.8% increase. HDFC Securities, however, reported a decline in profit to ₹2.3 billion from ₹2.9 billion in the same period last year.
Overall, HDFC Bank’s Q1 FY26 results reflect solid operational performance, strategic provisioning, and healthy subsidiary contributions, even as the bank positions itself conservatively for future economic uncertainties.
