HDFC Ltd to raise Rs 1,135 cr via debentures

Issue of the NCDs to be on a private placement basis will open for a day on May 6

HDFC Ltd today said it will raise Rs 1,135 crore by issuing debentures this week to meet funding requirements.

"The object of the issue is to augment the long term resources of the Corporation. The proceeds of the present issue would be utilized for financing/refinancing the housing finance business requirements of the Corporation", it said in a regulatory filing.

The issue of the non-convertible debentures (NCDs) to be on a private placement basis will open for a day on May 6.

The NCDs carry coupon rate of 8.34%. ICICI Bank and SBI Capital Markets are the arrangers to the issue. Shares of the mortgage lender closed 2.86 per cent higher at Rs 1,131 a piece on BSE.

HDFC Bank plans to raise Rs 50,000 crores via bonds

Private sector lender HDFC Bank today said it plans to raise Rs 50,000 crore through bonds over one year to fund business growth.

The board has accorded approval for seeking shareholders nod at the annual general meeting (AGM) for issue of perpetual debt instruments, tier-II bonds, senior long-term infra bonds up to a total amount of Rs 50,000 crore in the period of next 12 months through private placement, HDFC Bank said in a regulatory filing.

The board meeting will be held on May 19 to decide about the date for the AGM.

For the fourth quarter, HDFC Bank reported a 20.2 per cent jump in March quarter net at Rs 3,374.2 crore, helped by a healthy rise in core net interest income (NII).

The bank, which registered around 30 per cent profit growth for over a decade till 2013-14, posted a 20.4 per cent growth in post-tax profit at Rs 12,296.2 crore for the fiscal.

For January-March, NII rose 24 per cent to Rs 7,453.3 crore, while the non-interest income was up 11.8 per cent to Rs 2,865.9 crore.

On the asset quality front, gross non-performing assets (NPAs) were flat at 0.94 per cent of gross advances.

Net non-performing assets were at 0.3 per cent of net advances as on March 31, 2016. Total restructured loans were at 0.1 per cent of gross advances at the end of 2016-17.

Provisions and contingencies for the quarter ended March were Rs 662.5 crore as against Rs 576.7 crore in the corresponding quarter of the last year.

HDFC Bank is the Glenn McGrath of Indian banking

HDFC Bank’s balance sheet has crossed Rs7 trillion, narrowing the gap with ICICI Bank

Just like former Australian bowler Glenn McGrath used to land ball after ball in the same spot outside the off stump, HDFC Bank Ltd has unerringly posted another quarter of 20% net profit growth. If there was any mild excitement around its March quarter earnings, it was the utilization of around Rs.300 crore of floating provisions towards two accounts.

Half of this provision was on account of a central bank directive to all lenders to set aside 7.5% of their exposure to the Punjab state government, which is battling a foodgrain scam. It has to make a similar provision in the first quarter of this financial year. That said, at the end of the day, as the lender’s management clarified in a conference call, this loan has been made directly to the state government and would be classified as sovereign debt.

There was no untoward effect on HDFC Bank’s credit costs either. Annualized credit costs came in at 47 basis points in the March quarter, a decline from both a year ago and the previous quarter’s number. One basis point is one-hundredth of a percentage point. The bank maintained its asset quality performance with gross non-performing loans remaining under 1% of its advances.

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Other performance yardsticks hit the mark as well. Return on assets was 1.9% and cost-to-income ratio under 45%. The bank’s net interest margin was 4.3%; the management said the move to the new marginal cost of funds-based lending rate was unlikely to affect margins much. It reiterated its usual guidance of 4-4.4% margin for the current quarter as well.

With this set of numbers repeated quarterly, the trigger for stock performance is balance sheet growth. HDFC Bank’s balance sheet has crossed Rs.7 trillion, narrowing the gap with ICICI Bank. In the March quarter, loans grew 27%, about two-and-a-half times industry growth and especially creditable for a loan book of this size. Retail loans—driven by personal loans and home loans—grew by 30%. Deposits also grew faster than the industry at 21%.

While HDFC Bank shares trade at 3.3 times their expected book value for this financial year—among the most expensive in the world—it is its ability to disregard the operating environment that allows the stock to outperform the benchmark Bankex.

Sun Capital

HDFC to raise Rs 500 crore by issuing bonds to finance housing biz

The bonds with a tenor of five years, have April 26, 2021, as the redemption date

To cater to housing finance needs, India's largest mortgage lender HDFC on Monday said it will raise Rs 500 crore by issuing bonds on a private placement basis.

Issue size of Rs 500 crore secured redeemable non-convertible debentures, to be held on private placement basis, will carry a coupon rate of 8.35% per annum.

"The object of the issue is to augment the long-term resources of the corporation. The proceeds of the present issue would be utilised for financing/refinancing the housing finance business requirements of the corporation," HDFC said in a regulatory filing.

The bonds with a tenor of five years, have April 26, 2021, as the redemption date.

HDFC said the issue can be subscribed by only the persons who are specifically addressed through a communication by the company.

Scrips of the company traded 1.77% down at Rs 1,111.40 apiece on BSE.