HDB Financial experiences share drop post Q1 earnings
HDB Financial's stock dropped 3% to ₹815 on Wednesday after the company posted a 2.4% fall in net profit for the June quarter, landing at ₹568 crore.
Credit costs up 62%
Even though profits dipped, HDB's core business is still growing—net interest income jumped 18%, and assets under management went up by nearly 15%.
The real trouble was a sharp 62% rise in credit costs, mostly from setting aside more money for riskier loans like commercial vehicles and small businesses.
Analysts are mixed
To tackle these higher costs, HDB is reworking its loan strategy and hopes expected interest rate cuts from Q2 FY26 will help boost margins.
Analysts are mixed: Emkay Global still says "buy" but trimmed its outlook due to ongoing credit pressures, while Bonanza Portfolio pointed out that asset quality issues remain despite loan book growth.