Daijiworld Media Network - New Delhi

New Delhi, Oct 17: HDFC Bank Ltd, India's largest private sector lender, on Saturday reported a net profit of Rs 19,610 crore for the second quarter of FY27, missing analysts' expectations amid higher provisions and lower-than-expected net interest income.

The bank's net profit increased 5.2 per cent year-on-year in the quarter ended September 30. However, key operating metrics fell short of analysts' estimates, according to a report by NDTV Profit.

Net interest income (NII), the difference between interest earned and interest paid, rose 9.7 per cent year-on-year to Rs 34,619 crore. However, the figure was below the analysts' estimate of Rs 34,991.51 crore.

The bank's net interest margin (NIM), measured against total assets, stood at 3.16 per cent.

Provisions increased 2.1 per cent year-on-year to Rs 3,574 crore, compared with Rs 3,501 crore in the corresponding quarter last year, adding to the pressure on the bank's performance.

Asset quality, however, improved during the quarter. The gross non-performing asset (NPA) ratio declined to 1.11 per cent as of September 30, compared with 1.24 per cent a year earlier. The net NPA ratio also improved to 0.37 per cent from 0.42 per cent.

On the lending front, HDFC Bank's average advances under management grew 14.1 per cent year-on-year to Rs 31.87 lakh crore. Gross advances at the end of September rose 16.3 per cent to Rs 32.20 lakh crore.

Retail loans increased 11.7 per cent from a year earlier, while lending to small and mid-market enterprises registered stronger growth of 23.5 per cent.

On the liabilities side, average deposits rose 16.8 per cent year-on-year to Rs 31.66 lakh crore. Average current account and savings account (CASA) deposits increased 10.7 per cent to Rs 9.71 lakh crore.

HDFC Bank shares ended Friday on a flat note at Rs 728.10 on the BSE. The banking stock has declined around 10 per cent over the past year and 12 per cent year-to-date.