Highlights:
- HDFC Limited is the 6th Indian company to hit ₹ 5 lakh crore (trillion) market capitalisation
- HDFC Ltd., in the quarter which ended in December, posted net interest income of ₹ 4,000 crore
- The share of HDFC Ltd was trading at a record high of ₹ 2,808 on the BSE
On Friday, one of India’s biggest mortgage lender, HDFC Ltd., has hit ₹ 5 trillion in market capitalisation, as its shares surged to trade at a record high of ₹ 2,808 apiece on the Bombay Stock Exchange (BSE).
A little after 12:20 PM, the scrip traded at ₹ 2,795.50 per share which was up 1.3% from the previous close, taking the firm’s market cap at ₹ 5.03 lakh crore (trillion).
Since its March lows, the stock has bloated by close to 90%.
With this latest feat, HDFC Ltd has added itself to the list of elite companies in India which only had 5 companies before, namely, Reliance Industries Ltd (RIL), Tata Consultancy Services Ltd (TCS), HDFC Bank Ltd, Hindustan Unilever Ltd (HUL), and Infosys Ltd.
Mukesh Ambani-led Reliance Industries Limited is the most valued company in the country who enjoys a market cap of ₹ 13.2 lakh crore (trillion) which is closely followed by Tata Consultancy Services at ₹ 12.05 lakh crore (trillion), and HDFC Bank with ₹ 8.75 lakh crore (trillion) m-cap.
In the quarter which ended in December, HDFC Limited reported a net profit of ₹ 2,930 crore, which was down 65% from a year ago.
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However, its net interest income rose 25% to ₹ 4,000 crore while the firm’s operating profit surged by 29% to ₹ 4,190 crore.
HDFC Limited’s loan book advanced 9.3% year-on-year to ₹ 4.7 lakh crore (trillion), with the individual as well as the non-individual loan book rising 10.5% and 8%, respectively.
The assets under the company’s management also grew by 9.3%.
PhilipCapital, a brokerage firm, said that the individual home loan segment witnessed an impressive bounce back owing to the favourable combination of lowest mortgage interest rate along with some correction in the property prices.
It also said that HDFC Ltd, being a dominant player in the sector, witnessed similar faith in its individual loan portfolio. However, the under construction projects have witnessed delays and low sales velocity because of the nationwide lockdown and a preference for ready to move in property.
The brokerage firm said, “The impact of the same would trickle down to associated entities including the financie₹. However we believe that HDFC’s superior know-how of the segment; strict underwriting practices and buffer provision would help it to better manage the credit loss”.
The asset quality of HDFC Ltd remained stable in the last quarter, with stage three assets at 2.28% verus 2.19% in the quarter of July – September. Also, the restructured assets stood at 0.9% of AUM (Asset Under Management).
ICICI Direct said, “Business growth led by adequate capital and healthy earnings visibility on the back of funding advantage and provision buffer keeps us positive on the fundamental strength. We expect earnings to grow at 14% CAGR in FY21-23E with healthy RoA at 2.2% in FY23E,” in a note.
