HDFC Bank Limited
HDB · NYSE
Next quarter
Reports Oct 16, 2026.
Consensus is $0.40 EPS for Sep 2026 across 2 estimates, ranging $0.39 to $0.40.
HDB Jun 2026
- 5.26%
- -10.54%
- $0.38
- $0.40
- —
- —
Highlights
- Earnings beat: Reported EPS was 0.40 versus consensus of 0.38, a 5.26% surprise; standalone PAT was ₹190.6 billion, up 5.0% year over year but down 0.8% sequentially.
- Core income: Net interest income rose 6.7% year over year to ₹335.3 billion, with net interest margin at 3.26% on total assets and 3.40% on interest-earning assets.
- Cleaner comparison: Net revenue fell to ₹463.6 billion from ₹531.7 billion a year earlier, but the prior-year figure included ₹91.3 billion of gains from the HDB Financial Services IPO divestment.
- Loan growth: Gross advances increased 15.4% year over year to ₹30,608 billion; advances under management grew 12.4%, led by 18.7% SME growth and 18.6% corporate and wholesale growth.
- Deposit growth: End-period deposits rose 14.7% year over year to ₹31,708 billion, while average deposits grew 13.3%; CASA deposits represented 32.3% of the deposit base.
- Asset quality: Gross NPA ratio was 1.17%, up from 1.15% in March but down from 1.40% a year earlier; net NPA was 0.41%. Credit cost was 0.40%.
- Capital strength: Basel III capital adequacy was 19.6%, including CET1 of 17.4%, against a regulatory requirement of 11.9%.
- Subsidiary contribution: HDB Financial Services grew quarterly PAT 38.3% year over year to ₹7.9 billion, while HDFC Life PAT rose 11.9% to ₹6.1 billion and HDFC AMC PAT rose 12.1% to ₹8.4 billion.
- Consolidated result: Consolidated PAT was ₹192.4 billion, up from ₹162.6 billion a year earlier but down from ₹203.5 billion in March; consolidated net revenue was ₹854.8 billion.
Analysis
HDFC Bank’s June 2026 quarter was a modest earnings beat built on steady core banking growth rather than exceptional income. Reported EPS of 0.40 exceeded the 0.38 consensus estimate by 5.26%. Standalone PAT of ₹190.6 billion increased 5.0% year over year, although it declined 0.8% from March. The year-ago comparison is distorted by ₹91.3 billion of gains from the HDB Financial Services IPO divestment; management said adjusted PAT growth was approximately 9.8% after normalising for that gain, prior-year provisions and tax credits.
The defining operating trends were 6.7% net interest income growth to ₹335.3 billion, a 3.26% net interest margin on total assets, and strong balance-sheet expansion. Gross advances rose 15.4% year over year and deposits 14.7%, though time deposits grew faster than CASA, leaving CASA at 32.3%. Asset quality remained controlled, with gross NPAs at 1.17% versus 1.15% in March and 1.40% a year earlier. Provisions increased sequentially to ₹30.6 billion, but credit cost was contained at 0.40%. Consolidated PAT benefited from the stronger subsidiary portfolio, particularly HDB Financial Services, but fell 5.4% sequentially to ₹192.4 billion.
Core earnings and margins
The quarter showed resilient banking fundamentals despite a sharp reduction in reported other income from the unusually high year-ago base. Standalone net interest income rose 6.7% year over year to ₹335.3 billion and was up from ₹314.4 billion in March. Net interest margin was 3.26% on total assets and 3.40% on interest-earning assets. Other income was ₹128.2 billion, down from ₹217.3 billion a year earlier because the prior period included the HDBFS transaction gain, and slightly below ₹132.0 billion in March.
- Fees: Fees and commissions increased to ₹84.5 billion from ₹75.9 billion a year earlier.
- Costs: Operating expenses rose 4.4% year over year to ₹181.9 billion; the cost-to-income ratio was 39.2%.
- Credit costs: Provisions and contingencies were ₹30.6 billion, versus ₹26.1 billion in March and ₹144.4 billion a year earlier, when the bank made a ₹90 billion floating provision.
Deposit and loan growth
HDFC Bank continued to expand both sides of the balance sheet. End-period deposits reached ₹31,708 billion, up 14.7% year over year and 2.1% from March, while average deposits grew 13.3% year over year and 5.6% sequentially. Average CASA deposits increased 11.2% year over year to ₹9,570 billion, but time deposits grew 17.4%, reducing the CASA mix to 32.3% of end-period deposits.
- Advances: Gross advances rose 15.4% year over year to ₹30,608 billion; advances under management increased 12.4% year over year and 2.5% from March on an average basis.
- Mix: Retail loans grew 7.2%, small and mid-market enterprise loans 18.7%, and corporate and other wholesale loans 18.6%.
- Scale: Total assets increased to ₹43,975 billion from ₹39,541 billion a year earlier and ₹43,649 billion in March.
Asset quality and capital
Asset quality remained broadly stable, although the gross NPA ratio ticked up sequentially to 1.17% from 1.15% in March. It remained materially below the 1.40% recorded a year earlier. Excluding agricultural NPAs, the gross NPA ratio was 0.91%, unchanged from both comparison periods. Net NPAs were 0.41% of net advances, versus 0.38% in March and 0.47% a year earlier.
- Provisioning: The ₹30.6 billion quarterly provision charge translated into a total credit cost ratio of 0.40%.
- Capital: Basel III capital adequacy was 19.6%, with Tier 1 capital at 17.8% and CET1 at 17.4%, well above the 11.9% regulatory requirement.
- Projects: Project-finance accounts under implementation fell to 440 accounts with ₹20,785 billion outstanding from 447 accounts and ₹24,693 billion at the start of the quarter; 75 accounts achieved DCCO during the period.
Subsidiary performance
The consolidated result was supported by continued growth across the main subsidiaries. Consolidated PAT was ₹192.4 billion, up 18.4% year over year from ₹162.6 billion, though down 5.4% from ₹203.5 billion in March. Consolidated net revenue was ₹854.8 billion. Insurance contributed ₹1,750 million of segment profit, broadly below ₹1,779 million a year earlier, while the other financial businesses provided stronger growth.
- HDB Financial Services: PAT rose 38.3% year over year to ₹7.9 billion, with a ₹1,218 billion loan book and Stage 3 loans at 2.34%.
- HDFC Life: PAT increased 11.9% to ₹6.1 billion; the bank’s ownership was 50.54% at quarter-end.
- HDFC AMC and HDFC Securities: PAT rose 12.1% to ₹8.4 billion at HDFC AMC and 28.3% to ₹3.0 billion at HDFC Securities.
Governance and regulation
The bank said the external legal review relating to former part-time chairman Atanu Chakraborty’s resignation found that the statements and implications in his resignation letter were not substantiated by the records and witness interviews reviewed. HDFC Bank said the review had no impact on the financial results. Separately, the Dubai International Financial Centre branch remains restricted by the DFSA from soliciting or conducting business with new clients for specified services; the bank said the branch is not material to its operations or financial position.
