HDB Financial Services Q1FY26 net profit drops 2.4% YoY, loan growth strong at 14.3%

HDB Financial Services shares closed 0.3% lower on NSE at ₹841 apiece ahead of its results. The company declared its Q1FY26 results during post-market hours.

For the Q1FY26, the company’s net interest income jumped 18% YoY to ₹2092 crore as against ₹1,768 crore in the Q1FY25. This was largely due to a 17.3% YoY jump in the interest income at ₹3,831 crore as compared to ₹3,264 crore in the Q1FY25.

The net interest margin for the company remained intact at 7.6% in Q1FY26 as compared to 7.7% in the previous year's similar quarter.

The net profit for the quarter dropped by 2.4% YoY to ₹567 crore as against ₹581 crore in the previous year’s similar quarter. This was primarily due to higher coverage for the stage 3 loans at 56.7% vs the previous quarter at 55.9%.

The GNPA for the company stood at 2.56% for Q1FY26 as compared to 1.93% in Q1FY25 and 2,26% in Q4FY25. In addition, the NNPA for the quarter also jumped to 1.11% vs 0.77% in the previous year's similar quarter.

The company’s asset under management (AUM) stood at ₹ 1,09,690 crore for Q1FY25 compared to ₹ 95,643 crore in the same period last year, up by 14.7% YoY. Similarly, the gross loans for the quarter also jumped 14.3% YoY to ₹1,09,342 crore as of Q1FY25, as against ₹95,629 crore.

The lending profile for the NBFC largely remained unchanged with Enterprise loan contributing 40%, Asset Finance at 38% and Consumer Finance at 22%. However, the secured lending profile for the bank came down to 71% for the quarter from 73% in the previous quarter, indicating increased lending to risky assets and unsecured category.