HDFC Bank - Q4 Results Update.

Recently HDFC Bank has reported its Q4FY09 numbers. HDFC bank has reported its merged numbers with Centurion Bank of Punjab Ltd (CBoP) for Q4FY09. The merger of CBoP with HDFC Bank became effective on May 23, 2008. Therefore, these results are not comparable. Net interest income (NII) and net profits have risen 12.8% and 33.9%, respectively, for Q4FY09.

NIM stood at 4.2% during Q4FY09; Strong CASA growth (44.4% at the end of FY09) was very heartening to watch. Moderation was visible in the asset growth, which grew 29% on the average during Q4FY09 vis-à-vis the corresponding quarter last year. During the period, net NPA also increased both in absolute as well as in percentage terms.

HDFC bank would continue to enjoy the valuation premium vis-à-vis its peers on back of one of the highest CASA, high and stable margins, high RoE, cleaner asset quality and a large share of fee-income to its total income.

HDFC Bank has consistently delivered a growth of around 30% (YoY) in net profit for the past 28 quarters. However, it has rallied 40% in last one month from its recent lows. At CMP of Rs.1170, the stock is fairly valued and therefore, investors can wait for better entry points.