HDFC Bank Limited

Ladies and gentlemen, good day and welcome to HDFC Bank Limited Q2 FY25 earnings conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touch tone phone. Please note that this conference is being recorded. I now hand the conference Over to Mr. Srinivasan Vedanathan, Chief Financial Officer, HDFC Bank. Thank you and over to you, sir.

Thank you, Nirav. Welcome to all the participants. I appreciate dialing in today. We'll start with we have our CEO and Managing Director, Mr. Sashi Jagdishan with us. We'll start with his opening remarks and then get back to you all. Sashi, over to you.

Thank you, Srini, and thank you, friends. Let me first wish you a belated Dashera festivities and also wish you in advance the Diwali festivities that's going to come in next week itself. Let me start with some of the macro environment which we are witnessing. Liquidity has been gradually improving over the last couple of months. So that's a bit of a good news. However, the deposit rates continue to be elevated and sticky. Probably the credit growth still outpaces deposit growth in the system, and that's maybe the reason why it continues to be sticky. As we have witnessed in the previous high interest rate cycles, customer preferences continue to be towards time deposits, probably to lock in at higher rates. Despite intense competition and a competitive environment, Deposit growth has been very healthy. On an average basis, we have grown around 15% year on year. Retail branch continues to contribute around 80 to 85%, in fact, to be precise, 84% of the total deposits. Let me talk about the advances under management. We have mentioned in earlier public forums and calls that we will bring down the CD ratio faster than what we had anticipated in the past. Let me spell out some of the glide parts of our credit growth. FI25, we would probably grow slower than the system. FI26, we may be at or around the system growth rate. we should be faster than the system growth rate. Our assumption is that from all the regulatory comments in the monetary policy statements, there will be a convergence of system loan growth and deposit growth rates somewhere during this period. In the light of the above strategy, the average assets under management grew by about 10.2% year on year. The margins has been stable in the range that we have been talking about at 3.45 to 3.5%. It's printed at 3.46. The gross NPA continues to be stable at about 1.4%. In fact, the gross slippages at 1.2% is better than what we had witnessed same time last year. The profit after tax grew at about 16,800 crores. It shows an optical growth rate of 5.3%, but adjusted for the bond gains and for the tax adjustments that we enjoyed last, same time last year, the growth rate, adjusted growth rate is about 17%. Let me pause out here and we probably will, take a lot of questions, and we have the team out here, Srini, Bhavin, who probably will also chime in for responding to your questions.