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Financial Results for the Half-Year Ended September 30, 2015 Standalone & Consolidated


October 26, 2015 - Mumbai, Maharashtra, India

Business Wire India
Highlights
 
  • Board approves establishment of a Sponsored Level 1 ADR and Issue of Rupee Denominated Bonds Overseas
  • Standalone profit after tax at Rs. 1,605 crore for the quarter ended September 30, 2015 –  growth of 18%
  • 23% growth in the individual loan book (after adding back the loans sold in the preceding 12 months)
  • Spread on loans at 2.32% for the half year ended September 30, 2015 compared to 2.29% in the corresponding period last year
  • Gross non-performing loans at 0.71% of the loan portfolio as at September 30, 2015
  • Consolidated profit after tax at Rs. 4,311 crore for the half year ended September 30, 2015
 
The Board of Directors of Housing Development Finance Corporation Limited (HDFC) at its meeting held today approved the establishment of a Sponsored Level 1 American Depository Receipts (ADR) programme and the Issue of Rupee denominated bonds overseas.
 
At the meeting, it also approved the unaudited standalone and consolidated financial results for the first half of the financial year 2015-16, following its meeting on Monday, October 26, 2015 in Mumbai. The accounts have been subjected to a limited review by the Corporation’s statutory auditors in line with the regulatory guidelines.
 
SPONSORED LEVEL 1 ADR AND RUPEE DENOMINATED BONDS OVERSEAS BONDS
 
The board of directors approved
 
  • Establishment of a Sponsored Level 1 American Depository Receipts (ADR) programme in respect of up to 10% of the issued and paid-up share capital of the Corporation, pursuant to the Depository Receipts Scheme, 2014 and subject to requisite guidelines to be issued by SEBI. The programme envisages conversion of existing equity shares of the Corporation into ADRs and does not in any way entail any issue of additional shares of the Corporation.
  • Issue of Rupee denominated bonds overseas up to USD 750 million, in accordance with the circular dated September 29, 2015, issued by the Reserve Bank of India on External Commercial Borrowings Policy (ECB) - Issuance of Rupee denominated bonds overseas.
 
STANDALONE FINANCIAL RESULTS
 
Financials for the quarter ended September 30, 2015
 
For the quarter ended September 30, 2015, the profit before tax stood at Rs. 2,324 crore as compared to Rs. 1,982 crore in the corresponding quarter of the previous year, representing a growth of 17%.
 
After providing Rs. 719 crore for tax, (inclusive of Rs. 83 crore as deferred tax liability on Special Reserve), the profit after tax for the quarter ended September 30, 2015 stood at Rs. 1,605 crore as compared to Rs. 1,358 crore in the corresponding period previous year, representing a growth of 18%.
 
Financials for the half year ended September 30, 2015
 
For the six months ended September 30, 2015, the profit before tax stood at Rs. 4,276 crore as compared to Rs. 3,906 crore in the corresponding period of the previous year.
 
After providing Rs. 1,310 crore for tax (inclusive of Rs. 172 crore as deferred tax liability on Special Reserve), the profit after tax for the six months ended September 30, 2015 stood at Rs. 2,966 crore as compared to Rs. 2,702 crore in the corresponding period of the previous year, representing a growth of 10%.

TOTAL ASSETS
 
As at September 30, 2015 the total assets of HDFC stood at Rs. 2, 65,536 crore as against Rs. 2,38,361 crore as at September 30, 2014 – an increase of 11%.
  
LENDING OPERATIONS
 
As at September 30, 2015, the loan book stood at Rs. 2,37,991 crore as against Rs. 2,12,344 crore as at September 30, 2014. Loans sold in the preceding twelve months amounted to Rs. 12,969 crore. After adding back loans sold in the preceding 12 months, the growth in individual loan portfolio is 23%. The growth in the non-individual loan portfolio stood at 8%. The growth in the total loan book after adding back the loans sold in the preceding 12 months is 18%.
 
Of the total loan book, individual loans comprise 73%. The average size of the individual loans stood at Rs. 23.6 lac.
 
As at September 30, 2015, the total loans outstanding in respect of loans sold/assigned stood at Rs. 29,125 crore. HDFC continues to service these loans and is entitled to the residual interest on the loans sold. The residual interest on the individual loans sold is 1.22% p.a. and is being accounted over the life of the loans and not on an upfront basis.
 
Non-Performing Loans

Gross non-performing loans as at September 30, 2015 amounted to Rs. 1,707 crore. This is equivalent to 0.71% of the loan portfolio (previous year – 0.69%). The non-performing loans of the individual portfolio stood at 0.53% while that of the non-individual portfolio stood at 1.12%.
 
As per the National Housing Bank (NHB) norms, the Corporation is required to carry a total provision of Rs. 1,797 crore.   
 
The balance in the provision for contingencies account as at September 30, 2015 stood at Rs. 2,127 crore of which Rs. 518 crore is on account of non-performing loans and the balance Rs. 1,609 crore is in respect of general provisioning on standard loans and other provisions. This balance in the provision for contingencies is equivalent to 0.89% of the portfolio. Thus the Corporation carries an additional provision of Rs. 330 crore over the regulatory requirements.
 
Spread and Net Interest Margins
 
The spread on loans over the cost of borrowings for the half year ended September 30, 2015 stood at 2.32% compared to 2.29% in the corresponding period of the previous year.
 
Net Interest Margin for the half year ended September 30, 2015 was 3.95%.
 

INVESTMENTS
 

As at September 30, 2015, the unrealised gains on HDFC’s listed investments amounted to Rs. 58,169 crore (previous year - Rs. 45,871 crore). This excludes the appreciation in the value of unlisted investments.

CAPITAL ADEQUACY RATIO

The Corporation’s capital adequacy ratio after reducing the investment in HDFC Bank from Tier I capital, stood at 16.1%, of which Tier 1 capital was 12.8% and Tier II capital was 3.3%. Deferred Tax Liability on Special Reserve has also been considered as a deduction in the computation of Tier I and Tier II capital. As per regulatory norms, the minimum requirement for the Capital Adequacy Ratio and Tier I capital is 12% and 6% respectively.
 

In October 2015, the NHB recalibrated risk weights on individual housing loans, based on the loan amount and loan to value ratio, with the lowest risk weight being reduced to 35% compared to 50% earlier. The revised risk weights have not been applied in determining the above-mentioned capital adequacy ratio.
 

If the revised risk weights were to be applied as at September 30, 2015, the reduction in risk weighted assets would be Rs. 15,472 crore and the capital adequacy ratio would stand at 17.4%, of which Tier I would be 13.8%.
 

DISTRIBUTION NETWORK
 

HDFC’s distribution network spans 392 outlets, which include 113 offices of HDFC’s distribution company, HDFC Sales Private Limited (HSPL). In addition, HDFC covers additional locations through its outreach programmes. Distribution channels form an integral part of the distribution network with home loans being distributed through HSPL, HDFC Bank Limited and third party direct selling associates.
 
To cater to non-resident Indians, HDFC has representative offices in London, Dubai and Singapore and service associates in Kuwait, Oman, Qatar, Abu Dhabi and Saudi Arabia.
 
 
CONSOLIDATED FINANCIAL RESULTS

For the half year ended September 30, 2015, the consolidated profit after tax stood at Rs. 4,311 crore as compared to Rs. 3,937 crore in the corresponding period last year.
 
The share of profit from subsidiary and associate companies in the consolidated profit after tax stood at 31% for the half year ended September 30, 2015.
  
SALE OF SHARES OF HDFC STANDARD LIFE INSURANCE COMPANY LIMITED (HDFC LIFE)
 
As indicated in August 2015, the Corporation agreed to sell 9% of the equity shares in HDFC Life to Standard Life (Mauritius Holdings) 2006 Limited subject to the receipt of regulatory approvals.  Necessary approvals are still in progress and hence the sale is not reflected in the financials for the half year ended September 30, 2015.
 
SIMULTANEOUS ISSUE OF WARRANTS AND NON-CONVERTIBLE DEBENTURES
 
In October 2015, HDFC concluded the issue of Warrants simultaneously with the issue of Non-Convertible Debentures (NCDs) to Qualified Institutional Buyers (QIBs) on a Qualified Institutions Placement (QIP) basis. The Corporation received an amount of Rs. 5,051 crore towards the NCDs and upfront Warrant payment. This amount is not reflected in the financial results for the half year ended September 30, 2015.

 To View the PDF, please click on the links below:

Financial Results (Consolidated) – for quarter/six months ended in Sept, 2015
Financial Results (Standalone) – for quarter/six months ended in Sept, 2015
September 2015

Source: Business Wire India

BusinessWireIndia

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