The housing finance major's standalone net profit tanked 65.05% to Rs 2,925.83 crore in Q3 December 2020 from Rs 8,372.49 crore in Q3 December 2019.
Total income stood at Rs 11,716.34 crore in Q3 December 2020, dropping 42.25% from Rs 20,291.45 crore in Q3 December 2019. Profit before tax tumbled 58.95% to Rs 3,752.54 crore during the period under review. Total tax expense rose 7.29% to Rs 826.71 crore in Q3 FY21 over Q3 FY20. The result was announced during market hours today, 2 February 2020.
However, the company said that earnings for the December quarter was not comparable with the previous quarter as it included the earnings of Gruh Finance. The company also reported profit on sale of part stake in HDFC Life Insurance Company in Q3 FY21. To facilitate a like-for-like comparison, the adjusted profit before tax for the quarter ended 31 December 2020 is Rs 3,694 crore compared to Rs 2,908 crore in the previous year, reflecting a growth of 27%.
The net interest income (NII) for the quarter ended 31 December 2020 stood at Rs 4,068 crore compared to Rs 3,240 crore in the previous year, representing a growth of 26% Y-o-Y. All investments in the corporation's subsidiary and associate companies are carried at cost and not at fair value. Accordingly, as at 31 December 2020, the unaccounted gains on listed investments in subsidiary and associate companies amounted to Rs 2,52,910 crore.
HDFC said the demand for home loans continued to remain strong owing to low interest rates, softer property prices, concessional stamp duty rates in certain states and continued fiscal incentives on home loans. The month of December 2020 witnessed the highest ever levels in terms of receipts, approvals and disbursements. During the quarter ended 31 December 2020, 91% of individual disbursements entailed property deals entered over the past four months, re-affirming that housing demand remains robust and is not pent-up demand.
The COVID-19 induced pandemic has given a strong fillip to various digitalisation initiatives offered by the corporation. Despite the easing of lockdown restrictions, the trend of digital on-boarding of customers continued. Approximately 81% of new employed borrowers opted for the digital mode. During the quarter ended 31 December 2020, individual loan disbursements grew at 26% over the corresponding quarter of the previous year. Growth in home loans was seen in both, the affordable housing segment as well as high-end properties.
As at 31 December 2020, Rs 5,010 crore was being restructured under the RBI's Resolution Framework for COVID-19 related stress, which was 0.9% of AUM, the banking major reported. Of the loans being restructured, 26% are individual loans and 74% non-individual loans. The largest account under the resolution framework accounted for 0.5% of AUM. Cumulative COVID-19 provision as at 31 December 2020 stood at Rs 959 crore.
The corporation has gradually unwound its high liquidity levels as seen in the previous quarter. The average daily balance in liquid funds during the quarter ended 31 December 2020 was Rs 16,800 crore compared to Rs 22,500 crore in the previous quarter. With various liquidity measures taken by the RBI coupled with a less risk averse environment, the corporation is maintaining comfortable liquidity levels, whilst also endeavouring to minimise negative carry. The corporation has continued to raise resources from a diversified base.
The average size of individual loans disbursed during the nine months ended 31 December 2020 stood at Rs 28.50 lakh. The average loan size for the quarter ended 31 December 2020 was higher at Rs 30 lakh. As on 31 December 2020, the loans on an assets under management (AUM) basis stood at Rs 5,52,167 crore as against Rs 5,05,401 crore in the previous year. As at 31 December 2020, individual loans comprise 76% of the Assets Under Management (AUM). As at 31 December 2020, the individual loan book on an AUM basis grew 10% and the non-individual loan book grew by 7%. The growth in the total AUM was 9%.
During the quarter ended 31 December 2020, HDFC assigned loans amounting to Rs 7,076 crore to HDFC Bank compared to Rs 4,258 crore in the corresponding quarter of the previous year. Loans sold in the preceding twelve months amounted to Rs 16,956 crore. As at 31 December 2020, the outstanding amount in respect of individual loans sold was Rs 68,073 crore. HDFC continues to service these loans. The growth in the individual loan book, after adding back loans sold in the preceding 12 months was 16%. The growth in the total loan book after adding back loans sold was 13%.
Overall collection efficiency ratios for individual loans have improved, nearing pre-COVID levels. The collection efficiency for individual loans in the month of December 2020 stood at 97.6% compared to 96.3% in the month of September 2020. As per regulatory norms, the gross non-performing loans as at 31 December 2020 stood at Rs 8,012 crore. This is equivalent to 1.67% of the loan portfolio. The non-performing loans of the individual portfolio stood at 0.79% while that of the non- individual portfolio stood at 4%. The quarter ended 31 December 2020, saw resolutions in certain non-individual loans.
If the Supreme Court order of maintaining the classification of accounts as status quo till further orders were not to be considered, the non-performing loans would have been higher at 1.91% of the loan portfolio; with individual NPLs at 0.98% and non-individuals NPLs at 4.35%.
HDFC is required to carry a total provision of Rs 6,579 crore. The provisions as at 31 December 2020 stood at Rs 12,342 crore. The provisions carried as a percentage of the Exposure at Default (EAD) is equivalent to 2.56%.
Shares of HDFC rose 2.86% at Rs 2,656.35. HDFC's distribution network spans 589 outlets which include 202 offices of HDFC's distribution company, HDFC Sales (HSPL). HDFC covers additional locations through its outreach programmes. Distribution channels form an integral part of the distribution network with home loans being distributed through HSPL, HDFC Bank and third-party direct selling associates. The corporation also has online digital platforms for loans and deposits. To cater to non-resident Indians, HDFC has offices in London, Dubai and Singapore and service associates in the Middle East.
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