India’s largest private lender records ₹18,155 crore net profit; HDB IPO boosts gains
Mumbai : HDFC Bank, India’s largest private sector lender, reported a 12.24% year-on-year increase in net profit for the first quarter of FY2025-26, reaching ₹18,155 crore, surpassing analyst expectations. The results reflect strong fundamentals bolstered by higher income and gains from the HDB Financial Services IPO.
The bank’s net interest income (NII) rose 5.4% year-on-year to ₹31,438 crore, while the net interest margin (NIM) stood at 3.35%, slightly lower than 3.46% in Q4 FY2025. The decline in margin was attributed to the faster repricing of deposits compared to assets.
Operating expenses increased 4.9% to ₹17,434 crore in Q1 FY2026 from ₹16,621 crore in the same quarter last year. This includes ₹6,158 crore in employee costs and ₹11,276 crore in other expenses. Excluding the impact of the HDB IPO gains, the cost-to-income ratio stood at 39.6%.
The bank’s total standalone income rose to ₹99,200 crore, compared to ₹83,701 crore in Q1 FY2025. Gross advances as of June 30, 2025, were ₹26.53 lakh crore, a 6.7% increase year-on-year. Total deposits surged 16.2% to ₹27.64 lakh crore, with a CASA ratio of 33.9%, down from 38.2% in the same period last year. Savings account deposits stood at ₹6.39 lakh crore, and current account deposits at ₹2.98 lakh crore.
On the consolidated level, total income rose to ₹1.33 lakh crore from ₹1.17 lakh crore a year ago. The bank’s capital adequacy ratio (CAR) improved to 19.88%, up from 19.33% last year.
The HDB Financial Services IPO significantly boosted non-interest income, which jumped to ₹21,730 crore. This included ₹75.9 crore from fees and commissions, ₹16.3 crore from forex and derivatives, and ₹101.1 crore from trading and mark-to-market gains. HDFC Bank’s stake in HDB dropped to 74.19% as of June 30, from 94.32% in the previous quarter, due to stake dilution post-IPO. The IPO alone resulted in a ₹9,128 crore pre-tax gain for the bank.
Pre-tax profit from insurance subsidiaries contributed ₹1,645 crore to the bottom line.
In terms of asset quality, the Gross NPA ratio was recorded at 1.40%, and Net NPA at 0.47%, both marginally higher than the previous year but still within comfortable limits. Return on Assets (RoA) remained steady at 0.48%.
Operating profit for the quarter stood at ₹35,734 crore, while total provisions rose to ₹14,442 crore, including ₹9,000 crore in floating provisions and ₹1,700 crore in contingent provisions.
In a shareholder-friendly move, the board approved a special interim dividend of ₹5 per share and a 1:1 bonus issue, signaling continued confidence in the bank’s long-term growth trajectory. Shareholders registered by July 25 will receive the interim dividend, with payouts scheduled for August 11. The bonus issue, subject to shareholder and regulatory approvals, will entitle shareholders to one bonus share for every share held, with a record date set for August 27.
HDFC Bank also launched a new initiative titled “Purani Gaadi, Nayi Shuruaat”, focusing on financing pre-owned vehicles, aimed at expanding its retail lending footprint across semi-urban and rural markets.
With solid financials, robust asset growth, and tech-driven retail initiatives, HDFC Bank continues to lead the sector as a benchmark in Indian banking excellence.
