HDFC Bank shares fall over 7 per cent in two days after Q1 earnings
AI Summary
HDFC Bank's shares have fallen over 7% in two days, erasing approximately Rs 89,636 crore from its market valuation, following disappointing quarterly earnings primarily due to a decline in net interest margins. The bank reported a 5% increase in net profit but a drop in total income, leading to a negative market reaction that also impacted broader indices like the BSE Sensex and NSE Nifty.
Shares of HDFC Bank extended their previous session’s decline, falling over 7 per cent in two days and wiping out Rs 89,636 crore from its market valuation, after the lender’s quarterly earnings disappointed on the margin front.
The stock declined 2.08 per cent to settle at Rs 761.45 on the BSE. During the day, it slipped 2.25 per cent to Rs 760.10.
At the NSE, the stock dipped 2.08 per cent to end at Rs 761.45.
Shares of HDFC Bank had tumbled over 5 per cent on Monday.
In two days, the blue-chip stock has tanked 7.10 per cent, wiping out Rs 89,635.73 crore from its market valuation.
HDFC Bank dragged the markets for a second day. The 30-share BSE Sensex declined 238.41 points, or 0.31 per cent, to settle at 77,470.11. The 50-share NSE Nifty edged lower by 50.80 points, or 0.21 per cent, to end at 24,187.70.
According to market experts, HDFC Bank has disappointed, particularly on the NIM (Net Interest Margins) front.
HDFC Bank on Saturday reported a 5 per cent increase in standalone net profit to Rs 19,060 crore for the June quarter.
The country’s biggest private sector lender had earned a net profit of Rs 18,155 crore in the year-ago period.
However, total income of the bank during the quarter under review dropped to Rs 92,184 crore from Rs 99,200 crore in the same period a year ago, HDFC Bank said in a regulatory filing.
The lender’s interest income increased to Rs 79,363 crore from Rs 77,470 crore in the same quarter a year ago.
During the period, operating profit of the bank declined to Rs 28,169 crore, as compared to Rs 35,734 crore in the same quarter a year ago.
Net interest income grew 7 per cent to Rs 33,530 crore for the June quarter from Rs 31,440 crore a year ago, it said.
Net interest margin was at 3.26 per cent on total assets, and 3 per cent based on interest-earning assets.
Original Article
Published on Hindu BusinessLine