The bank reported Rs 2,233 crore profit against Rs 1,844 crore in the April-June quarter of 2013-14.
The bank attributed the fall in profit to a 20-basis point dip in net interest margin (NIM), which declined to 4.4 per cent in the reporting quarter.
However, total income jumped to Rs 13,070.7 crore from Rs 11,588.56 crore in the year-ago period.
"NIM in the first quarter was stable sequentially, but on a y-o-y basis it has dropped slightly. If you look at our range of NIM, it has been around 4.1-4.4 percent. It would be at the upper end of the range going forward," HDFC Bank Deputy Managing Director Paresh Sukthankar told reporters here.
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Net interest income, which is the interest earned minus interest paid, during the period grew 17 per cent to Rs 5,171.6 crore he said. It accounted for 74 per cent of net revenue.
The asset quality slightly deteriorated with gross non-performing assets (NPAs) at 1.07 per cent as against 1.04 per cent, while net NPA was stable at 0.3 per cent.
"The three-four basis points increase in NPAs has happened from agriculture, SME and a little bit on retail, including commercial vehicles and commercial equipment businesses. There is not a large particular segment which showed any material deterioration," Sukthankar said, adding the bank did not sell any NPAs during the quarter.
HDFC Bank had earned a reputation for delivering over 30 per cent profit growth for 37 straight quarters in the past 10 years (40 quarters).
In the previous quarter, it had reported 23 per cent growth in profit, the lowest in 10 years. For the October-December period, the bank's profit growth was 25 per cent. In the preceding quarter, the rise was 27 per cent.