HDFC Ltd Financial Results for the Year Ended March 31, 2014

Mumbai, Maharashtra, India- Business Wire India  Performance Highlights  20% increase in the consolidated profit after tax to Rs. 7,947.82 crore for the year ended March 31, 2014 -- 22% increase (after reducing the redemption premium on Zero Coupon Debentures) Standalone profit before dividend, sale of investments and tax increased 15% to Rs. 6,635.67 crore for the year ended March 31, 2014 Standalone profit after tax increased 12% to Rs. 5,440.24 crore for the year ended March 31, 2014 Dividend of Rs. 14 per equity share of face value of Rs. 2 per share Standalone Net Interest Margin for the year ended March 31, 2014 at 4.1%, spread on loans at 2.29% 26% growth in the individual loan book (after adding back the loans sold in the preceding 12 months) Gross non-performing loans stood at 0.69% of the loan portfolio as at March 31, 2014 compared to 0.77% as at December 31, 2013  The Board of Directors of Housing Development Finance Corporation Limited (HDFC) approved the consolidated and standalone audited financial results of the Corporation for the year ended March 31, 2014 at its meeting held on Tuesday, May 6, 2014 in Mumbai.  CONSOLIDATED FINANCIAL RESULTS  For the year ended March 31, 2014, the consolidated profit after tax stood at Rs. 7,947.82 crore as compared to Rs. 6,639.72 crore for the year ended March 31, 2013 – an increase of 20%.  The consolidated profit after tax for the year ended March 31, 2014 does not consider the charge in respect of the redemption premium on Zero Coupon Debentures amounting to Rs. 357.17 crore (net of tax) {Rs. 438.04 crore for the year ended March 31, 2013}.  Had the aforesaid adjustment been considered, the profit after tax for the year ended March 31, 2014 would have been Rs. 7,590.65 crore compared to Rs. 6,201.68 crore for the year ended March 31, 2013, representing an increase of 22%.  The share of profit from subsidiary and associate companies in the consolidated profit after tax grew to 32% for the year ended March 31, 2014 compared to 27% in the previous year.  STANDALONE FINANCIAL RESULTS  Financials for the year ended March 31, 2014  For the year ended March 31, 2014, profit before dividend, sale of investments and tax stood at Rs. 6,635.67 crore as compared to Rs. 5,776.63 crore in the previous year, representing a growth of 15%.  Dividend and profit on sale of investments during the year ended March 31, 2014 were at Rs. 804.57 crore as compared to Rs. 796.21 crore in the previous year.  After considering Rs. 2,000 crore for tax, the profit after tax stood at Rs. 5,440.24 crore as compared to Rs. 4,848.34 crore for the year ended March 31, 2013 – an increase of 12%.  Financials for the quarter ended March 31, 2014  For the quarter ended March 31, 2014, the profit after tax amounted to Rs. 1,723.10 crore (previous year – Rs. 1,555.21 crore).  DIVIDEND  The Board of Directors recommends payment of dividend for the year ended March 31, 2014 of Rs. 14 per equity share of face value of Rs. 2 per share as against Rs. 12.50 per equity share for the previous year.  TOTAL ASSETS  As at March 31, 2014, the total assets of HDFC stood at Rs. 2,25,757 crore as against Rs. 1,95,361 crore as at March 31, 2013 – an increase of 16%.  LENDING OPERATIONS  As at March 31, 2013, the loan book stood at Rs. 1,97,100 crore as against Rs. 1,70,046 crore in the previous year. Loans sold during the preceding twelve months amounted to Rs. 6,944 crore, of which Rs. 5,317 crore was sold in the quarter ended March 31, 2014. The growth in the individual loan book, after adding back loans sold is 26% (20% net of loans sold). Due to the economic slowdown and the increased risks in non-individual lending, this portfolio grew by 9%. The growth in the total loan book, inclusive of loans sold is 20% (16% net of loans sold).  Of the total loan book, individual loans comprise 71%. Further, 85% of the incremental growth in the loan book during the year came from individual loans.  As at March 31, 2014, the total loans outstanding in respect of loans sold/assigned stood at Rs. 20,663 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/assigned is 1.32% p.a. and is being accounted over the life of the loans and not on an upfront basis.  Approvals and Disbursements  Individual loan approvals and disbursements grew by 16% and 21% respectively during the year. The average size of individual loans stood at Rs. 22.1 lac as compared to Rs. 21.6 lac in the previous year.  Non-Performing Loans  Gross non-performing loans as at March 31, 2014 amounted to Rs. 1,357 crore.  This is equivalent to 0.69% of the portfolio (as against 0.77% as at December 31, 2013). The non-performing loans of the individual portfolio stood at 0.53% while that of the non-individual portfolio stood at 1.01%.  As per NHB norms, the Corporation is required to carry a total provision of Rs. 1,460 crore.  The balance in the provision for contingencies account as at March 31, 2014 stood at Rs. 1,907 crore of which Rs. 546 crore is on account of non-performing loans and the balance Rs. 1,361 crore is in respect of general provisioning and other provisions. This balance in the provision for contingencies is equivalent to 0.96% of the loan portfolio. The Corporation carries an additional provision of Rs. 447 crore over the regulatory requirements.  Spread and Net Interest Margin  The spread on loans over the cost of borrowings for the year ended March 31, 2014 stood at 2.29%.  Net Interest Margin for the year ended March 31, 2014 was ­­­­­­4.1%.  INVESTMENTS  As at March 31, 2014, the unrealised gains on HDFC's listed investments amounted to Rs. 38,213 crore (previous year Rs. 30,698 crore). This excludes the appreciation in the value of the unlisted investments.  CAPITAL ADEQUACY RATIO  The Corporation's capital adequacy ratio, without reducing the investment in HDFC Bank from Tier I capital, while treating it as a 100% risk weight stood at 17.9% of the risk weighted assets, of which Tier I capital was 15.4% and Tier II capital 2.5%. The capital adequacy ratio after reducing the investment in HDFC Bank from Tier I capital stood at 14.6%, of which Tier I capital was 12.1% and Tier II capital was 2.5%.  As per the regulatory norms, the minimum requirement for the capital adequacy ratio and Tier I capital is 12% and 6% respectively of the risk weighted assets.   COST INCOME RATIO  For the year ended March 31, 2014, the cost to income ratio stood at 7.9%.  REVIEW OF KEY SUBSIDIARY COMPANIES  HDFC Standard Life Insurance Company Limited (HDFC Life)  Gross premium income for the year ended March 31, 2014 stood at Rs. 12,063 crore as compared to Rs. 11,323 crore in the previous year.   HDFC Life has reported a profit after tax of Rs. 725.28 crore for the year ended March 31, 2014 as against Rs. 451.48 crore in the previous year. The back book is generating sufficient profits to offset the new business strain incurred in writing of new policies.    As at March 31, 2014, the Market Consistent Embedded Value stood at Rs. 6,992 crore The new business margin on individual business stood at 26.2% (based on loaded acquisition expenses).   HDFC Life ranked third among private sector life insurers in terms of market share based on the weighted received premium of individual business for FY 2014.  HDFC Asset Management Company Limited (HDFC AMC)  As at March 31, 2014, HDFC AMC managed 50 debt, equity, exchange traded and fund of fund schemes of HDFC Mutual Fund. The average assets under management during the month of March 2014 stood at Rs. 1,16,753 crore (which is inclusive of average assets under discretionary portfolio management and advisory services).  For the year ended March 31, 2014, HDFC AMC reported a profit after tax of Rs. 357.77 crore as against Rs. 318.75 crore in the previous year  HDFC Mutual Fund ranked first in the industry on the basis of Quarterly Average Assets under Management for the year ended March 31, 2014.  HDFC ERGO General Insurance Company Limited (HDFC ERGO)  During the year, HDFC ERGO was the fourth largest private player in the general insurance industry. The company continued to be the largest player in the personal accident line of business.    The gross direct premium (excluding Motor and Declined risk pool) of the company increased by 20% to Rs. 2,978 crore as against Rs. 2,491 crore in the previous year. The profit after tax for the year stood at Rs. 195.41 crore as against Rs. 154.50 crore in the previous year.  DISTRIBUTION NETWORK  HDFC's distribution network spans 354 outlets which include 93 offices of HDFC's distribution company, HDFC Sales Private Limited (HSPL). HDFC also 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 an office in London, Dubai and Singapore and service associates in Kuwait, Oman, Qatar, Abu Dhabi and Saudi Arabia.  To view the results, please click on the links given below:  March 2014  Exchange Qtr March14 Consolidated  Exchange Qtr March14 Standalone  Media Contact Details Mahesh Shah, Housing Development Finance Corporation Limited, +91(22) 66316410, maheshs@hdfc.com  Contributed via: Bloomberg Publisher WEB Service  Provider ID: aba5c82e8c804ed390a57da8b3c3b67d 
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