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Stocks

HDFCBANK Q2 Through the Roof, 30% EPS Growth

In another magnificent display HDFC Bank takes its EPS up 30% in what others would call a tough environment.

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The stock was up 3% on a very smart rally in the markets, and ended at Rs. 492, for a P/E of around 26.

Net NPAs are just 0.2% of assets, they say, at Rs. 355 cr. And their Capital Adequacy is at 16.5%, a decent number. Most profits (957 cr.) came in from retail banking (lending plus fees minus deposit costs, plus any credit card numbers I guess) Wholesale banking adding 670 cr. and treasury pitched in with 39 cr. (though higher than the 18 cr. last quarter and a loss of 52 cr. last year).

There’s not much about losses from loans out there; so interest rate increases are getting passed on (I suppose). There are no relevant subsidiaries (HDFC Mutual fund and Insurance are owned by HDFC Bank’s parent, HDFC Limited). Will add more to this post after them interviews.

  • bemoneyaware says:

    HDFC Bank is different from other shares. It is the closest thing you can get to an annuity scheme – like a regular monthly pension – in the share market today.
    Between 2006 and now, the share price has been compounding at the rate of 19.45 percent annually. Which means, even excluding dividends and share splits, you can assume tax-free long-term capital gains growth of nearly 20 percent a year.
    Assuming the share continues to compound at the same rate for the next five years, the HDFC Bank share should be at Rs 1,184 by 2016.