HDFC–Profit may fall up to 22% in absence of dividend income – The Economic Times

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The NBFC is slated to release its quarterly results on Monday, May 25.

NEW DELHI: Mortgage lender Housing Development Finance CorporationNSE -5.08 % (HDFC) is expected to report 12-22 per cent decline in profit for the March quarter on likely fall in dividend income from subsidiaries. The NBFC is slated to release its quarterly results on Monday, May 25.

Kotak Institutional Equities expects HDFC to post a 21.30 per cent fall in profit on 7.30 per cent growth in net interest income (NII). The brokerage pointed out the NBFC major may not earn capital gain or dividend income.

“Unlike Q4FY19 when the company earned Rs 540 crore as dividend income, its subsidiaries have not paid any dividend to parent in Q4FY20,” Kotak said.

The brokerage also expects HDFC to deliver a 13 per cent year on year AUM growth, marginally lower than 14 per cent in Q3FY20, due to lower disbursements in the last 15 days of the quarter. Core NIMs are likely to moderate to 2.40 per cent from 2.50 per cent on quarter-on-quarter (QoQ) basis, reflecting the recent decline in home loan rates.

Motilal Oswal Financial ServicesNSE -1.26 % sees a 12 per cent fall in net profit at Rs 2,520.70 crore. An assessment by the brokerage also showed a 6.80 per cent rise in NII at Rs 3,377.40 crore during the quarter.

HDFC shares cracked 37 per cent on a year-to-date basis till May 22, while the benchmark BSE Sensex shed 26 per cent to 30,767.

Antique Stock Broking sees a 20.70 per cent YoY dip in bottomline in Q4. It also sees 22.10 per cent and 5.50 per cent fall in pre-provision profit and net interest income, respectively.

“We expect muted numbers from HDFC due to the absence of other income – dividend and stake sale,” the brokerage said.

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