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Thursday, January 29, 2015

HDFC Q3 profit up 12% on good demand in small towns

Housing Development Finance Corporation has posted a 12 per cent growth in its third quarter net profit aided by higher demand for home loans in the tier - II and tier - III towns.

In the three month period ended December 31, 2014, the Mumbai-based HDFC posted a net profit of Rs. 1,425 crore against Rs. 1,277 crore a year earlier.

Total income was up 14 per cent at Rs. 6,871 crore.

As at December 31, 2014, the loan book stood at Rs. 2,19,951 crore as against Rs. 1,92,284 crore as at December 31, 2013, the company said in a statement.

Most of HDFC’s small-sized peers also posted net profit growth in double digits driven by higher demand for home loans from customers in an under-penetrated home loan market.

Indiabulls Housing Finance and Dewan Housing Finance Limited posted a net profit growth of 21 per cent and 16 per cent respectively. LIC Housing Finance Limited, however, posted only a 6 per cent net profit growth.

Mortgage to GDP penetration in India continues to be among the lowest in the world. It currently stands at a mere 9 per cent of GDP in India compared to about 80 per cent in major developed markets.

This, despite the fact that housing being one of the major requirements in the country. There is an estimated shortfall of 21 million houses in the country, majority of them (about 19 million) in the lower income group (LIG) segment.

The LIG segment remains largely outside the purview of housing finance loans from mainstream financiers, including banks, because this segment often lack the “required” documentation to get such loans.

Shares of the company closed down 2.61 per cent at Rs. 1,309.55 per share on the BSE.


Source : Thehindubusinessline

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