Housing Development and Finance Corporation (HDFC) is one of the country’s leading providers of housing finance. HDFC provides housing finance and provides housing finance consultations to emerging nations across Asia, East Europe and Africa.
HDFC Market capitalisation
HDFC’s market capitalisation as of March 2018 is approximately Rs.3,06,000 crore.
Company’s Wealth and Recent Performance
- HDFC Limited’s overall loan book witnessed an 18% growth on an assets under management basis. Considering the growth in individual loans segment, the company reported a 25% increase. Furthermore, approximately 40% of all the home loans approved in this fiscal year were geared towards people belonging to economically weaker sections and low income group.
- Its standalone revenue from operations for the Q3 FY18 was reported to be at Rs.8,695 crore, in contrast to Rs.8,148 crore over the same period last year.
- Its standalone net profit after tax increased to Rs.5,670 crore for the third quarter. This is in comparison to the net profit of Rs.1,701.21 crore that the lender declared in the corresponding quarter last year. Thus, it is evident that its net profit improved by thrice as much over a period of one year.
- HDFC Limited’s consolidated profit after tax for this quarter was Rs.6,677 crore, in contrast to Rs.2,729 crore in the same quarter last year.
- The lender’s gross non-performing assets count (NPAs) as of December 31, 2017, stood at 1.15% of the loan portfolio which was well in line with the 1.14% reported in the September quarter.
HDFC Limited Stock Trends in 2018
- HDFC shares at the start of 2018 were trading at around Rs.1,700. The opening price on January 1 was Rs.1,710 on NSE and BSE. By mid-January, the stocks gained 7% driven by HDFC’s fundraising plan. The upward trend was observed for the entire month and the closing on January 31, 2018, was Rs.1,956 on NSE.
- HDFC stocks at the start of February commenced trading at around Rs.1,960. However, by the end of the first week, the stocks had lost all their previous gains owing to worldwide market turbulence and weak global cues. By mid-February, the stock price was back in the Rs.1,800 territory and it stayed at that level for the rest of the month. The closing price at the end of the month was Rs.1,808 on NSE.
HDFC Limited Stock Trends in 2016 and 2017
- HDFC Limited stock price at the start of January 2016 was around Rs.1,250. Over the course of the next few weeks, the scrip lost considerably and by mid-February, HDFC shares were trading at around Rs.1,080-1,090 on NSE and BSE. The price recovered slightly in March and the closing price at the end of the month was Rs.1,105 on NSE. An interim dividend of 150% was also announced by the company in March.
- In April, HDFC share price moved up slightly though it was not until late April-early May that the real rise began. A strong Q4 performance, stake sale plan, and the plan to raise funds via debentures helped the stock price cross Rs.1,200 in the final week of May. Through the month of June, the shares changed hands at well above Rs.1,200.
- In July, the scrip crossed Rs.1,300 and one of the main reasons for this was the lender issuing Rupee Denominated Bond. A robust performance in the June quarter also helped the stocks make considerable gains in this period. The share price remained above this level in August and in September, it crossed Rs.1,400, although it was only for a short while.
- For most of October, the share price remained in the Rs.1,300 territory. In November, post demonetisation, HDFC stocks shed their recent gains and went down to be traded at around Rs.1,220-1,250. The closing price at the end of the year was Rs.1,262 on NSE.
- HDFC share price at the start of 2017 was around Rs.1,220 on NSE and BSE. By the end of the month, the scrip managed to cross Rs.1,300 mark on the back of company updates. Through most of February and March, the stock price remained steadily above Rs.1,300. An interim dividend of 150% was announced in early March which helped the stock price move past Rs.1,400. Furthermore, HDFC bank raised additional funds through Rupee Denominated Bonds which drove the stock price beyond Rs.1,500.
- HDFC share price dipped slightly at the start of April, but only to recover by the end of the month. The shares were traded at above Rs.1,500 in May and in June, the stocks soared beyond Rs.1,600 driven by updates and performance reports.
- Things did not vary significantly for stocks in July. The investors continued to enjoy the bullish trend, which was accelerated after the announcement of final dividend of 750%. At the end of July, HDFC Limited stock price crossed Rs.1,700 on the back of HDFC Life IPO. Through August and September, the shares were being traded at values well above Rs.1,700.
- In early September, the shares were trading at around Rs.1,760-1,770. This upward run continued till mid-November when prices went down again, albeit only for a short while. The closing price at the end of the year was Rs.1,710 on NSE and BSE.
Should You Invest in HDFC?
- HDFC is one of the leading financial institutions in the country with a market cap of over Rs.3,00,000 crore, leagues ahead of its nearest competitor. The company reported positive results for the quarter ending December 2017, earning over Rs.8,800 crore in revenue for the period. While competitors have also seen an improvement in revenue, HDFC has held on to the majority of the market share in spite of new entrant into the market.
- With the increase in affordable housing projects sweeping the nation, coupled with the rise in disposable income and the urgent need for housing, demand for housing is likely to grow. As a result, it is estimated that non-banking financial institutions will receive a bigger piece of the loan market. In this regard, HDFC is poised to increase overall revenue and posited to see steady growth in the coming quarters.
- From a long-term perspective, investing in HDFC is likely to pay steady dividends and reap benefits given the prevalent paucity of housing in the country. However, it is wise to look at the company’s fundamentals before taking a decision.
HDFC Limited is a financial conglomerate headquartered in Mumbai, India. The company provides housing finance primarily in India. In addition to housing finance, the company has expanded into the general insurance, banking as well as venture capital segments.
HDFC was founded as a mortgage company, providing housing finance to both individuals as well as corporate customers for residential as well as commercial construction or purchase. In addition to disbursing loans, the company also provides deposits and education loans.
History of the Company
HDFC began operations in 1977 under the aegis of Mr. H.T. Parekh, and was incorporated as a company in October of 1977. HDFC operates out of India as well as offices in London, Singapore and the Middle East. From disbursing its first home loan in 1980 to becoming one of the largest mortgage providers in the country, HDFC has come a long way. The company began issuing deposits in 1981 and saw an exponential increase in its loan disbursals, crossing Rs.100 crore in 1984. The company also introduced customer-friendly measures such as the Step-Up Repayment Facility (SURF) to help lower income groups obtain larger loan amounts.
The company entered into strategic partnerships with a number of firms after the liberalisation of the economy, such as the one with Standard Life Assurance Company (UK) for life insurance.
HDFC became the first Indian company to dematerialise its shares and began to explore other sectors, setting up an insurance company and acquiring an interest in Credila Financial Services, the country’s first education loan company.
Mr. Deepak Parekh- Chairman
Associated with the company since 1978, Mr. Parekh has served as Chairman since 1993. He retired as the Chairman in 2009 and now serves as a Non-Executive Chairman. Mr. Parekh served as a whole-time Director in the company in 1985. A Fellow of the Institute of Chartered Accountants of England and Wales, he has overseen the expansion of the company across different verticals. In addition to his duties at HDFC, Mr. Parekh has also served on the boards of a number of firms such as Glaxo India Ltd, Mahindra & Mahindra, Siemens Ltd among others.
A recipient of a number of awards, he was been awarded the Padma Bhushan by the Indian Government for his services to the finance sector. He also serves as the Chairman of the Advisory Board for Securities Market set up the Reserve Bank of India.
Mr. Keki Mistry- Vice Chairman and Chief Executive Officer (CEO)
Mr. Mistry serves as the current CEO and Vice President of HDFC and has been associated with the company since 1981. He was appointed an Executive Director in 1993 and served as the Deputy Managing Director in 1999 before being appointed Managing Director in 2000.
He was appointed CEO in 2010 and also serves on the boards of several companies such as HDFC ERGO, Sun Pharmaceuticals, HCL Technologies among others. He is also a Director at the BSE (Bombay Stock Exchange) and has received numerous accolades for his contribution to the banking and financial industry.
A graduate of Mumbai University, Mr. Mistry completed his Bachelor’s in Commerce from Mumbai University and is a certified Chartered Accountant from the Institute of Chartered Accountants of India.
HDFC Stock Listing in NSE, BSE and Indices
HDFC shares can be traded on the Bombay Stock Exchange (BSE) as well as the National Stock Exchange (NSE) during trading hours. For the purpose of trading, the company can be identified by the following trading codes for various bourses:
HDFC shares can be traded on multiple bourses, a few of which have been listed below:
- S&P BSE 100
- Nifty 50
- Nifty Bank
- MCX-SX Bank Index
- S&P BSE Bankex
The company’s head office is at the following location:
H.T. Parekh Marg,
165-166, Backbay Reclamation,
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