HDB Financial Q2 profit climbs 34%, NIM improves year on year, eyes stronger disbursements in H2

Net interest income rose 15.6% year on year to Rs 2,534 crore, while total net income increased 14% to Rs 2,891 crore.

Ramesh Ganesan, managing director and chief executive of HDB Financial Services, said the festive season was expected to provide a significant boost to consumer finance. The company has also begun using artificial intelligence to shorten customer onboarding time in the segment.

Net interest margin widened to 8.23% from 7.95% a year earlier but narrowed from 8.35% in the June quarter. Credit costs fell 2.5% year on year to Rs 730 crore.

The gross loan book grew 12% year on year to Rs 1.24 lakh crore at the end of September. Quarterly disbursements rose 19% to Rs 18,522 crore, while the customer base expanded 18.4% to 24.8 million. Secured loans accounted for 74% of the loan book.

Speaking to analysts, chief financial officer Jaykumar Shah said disbursement momentum was expected to strengthen in the second half, with Q3 typically better than Q2 and Q4 better than Q3. Growth is expected to be driven by loan against property, gold loans and unsecured business loans.

The company’s capital adequacy ratio stood at 21.37% at the end of September. The board declared an interim dividend of Rs 2 per equity share.