HDFC Bank share price drops over 3% as deposits and advances growth declines in Q1

HDFC Bank share price fell over 3% in early deals on Friday after the private lender reported its first quarter business update, showing a sequential decline in both advances and deposits.

Advances of HDFC Bank, the country's largest private sector lender, declined 0.8% quarter-on-quarter (QoQ) to $1,24,999.90. from Rs 24.87 lakh crore by the end of June 2024 It will reach Rs 25.1 lakh crore by the end of March 2024.

The sequential decline in the loan book was primarily due to the continued reduction in the low-yield corporate book, including erstwhile HDFC Ltd.

However, the bank's advances grew by 52.6% On year-on-year basis, it stood at Rs 16.30 lakh crore.

Deposits in Q1FY25 were as follows ₹23,79,000 crore, registering a growth of 24.4% over the previous year. ₹ 19,13,100 crore, year-on-year. Deposits were at the same level as compared to the previous fiscal. ₹23,79,800 crore by March 31, 2024.

Excluding the merger effect of July 2023, the bank's deposits grew 16.5% as of June 30, 2023, HDFC Bank said in a regulatory filing

The share of HDFC Bank's low-cost current and savings accounts (CASA) as a proportion of total deposits fell to 36.3% at the end of June 2024, from 38.2% at the end of March 2024.

CASA deposits grew by 6.2% as of June 30 Rs 8,63,500 crore ₹ 8,13,000 crore, year-on-year, while it declined by about 5% ₹9,08,800 crore, quarter-on-quarter.

The liquidity coverage ratio improved to 123% in the first quarter compared to 115% in the previous quarter.

HDFC Bank share price hit a record high this week. The stock closed at Rs 1,791.90 per share on BSE on expectations of higher passive fund flows amid a possible weightage increase in the MSCI index.

The latest shareholding pattern of HDFC Bank shows that ownership of foreign institutional investors (FIIs) in the bank has fallen below 55%, which is expected to increase the weightage of HDFC Bank stock in the MSCI index, leading to increased passive flows.

At 9:17 am, HDFC Bank shares were trading lower by 3.34%. It closed at Rs 1,668.90 per share on BSE.

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