India’s largest private sector lender, HDFC Bank, delivered a strong performance in the fourth quarter of FY25, surpassing market expectations with a 6.7% year-on-year rise in standalone net profit, which stood at ₹17,616 crore. The earnings beat analyst projections of ₹17,072 crore, as per a poll conducted by Moneycontrol. On a sequential basis, the bank’s net profit was up 5.3%, reflecting continued momentum in its core business operations.
Dividend Announcement
In a shareholder-friendly move, HDFC Bank’s board has recommended a dividend of ₹22 per share of face value ₹1 each for the financial year 2024-25. The record date for determining eligibility for the dividend has been set for Friday, June 27, 2025.
Asset Quality: Mixed Signals
The bank showed notable improvements in its gross non-performing asset (NPA) ratio, which declined to 1.33% as of March 31, 2025, from 1.42% at the end of the previous quarter. However, on a year-on-year basis, this figure was slightly higher than the 1.24% recorded on March 31, 2024.
Similarly, the net NPA ratio declined to 0.43% in Q4 FY25 from 0.46% in the December quarter, but was up from 0.33% a year ago, indicating some pressure on asset quality over the longer term.
In absolute terms:
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Gross NPAs stood at ₹35,222.64 crore at the end of March 2025, down from ₹36,018.58 crore in December 2024.
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However, this marked an increase from ₹31,173.32 crore reported in the same period last year.
Market Reaction
Ahead of the earnings announcement, HDFC Bank shares closed 1.48% higher at ₹1,905.80 on the NSE on Thursday, reflecting investor optimism. The stock’s positive movement suggests market confidence in the bank’s financial performance and future outlook.
What This Means for Investors
The robust profit figures and stable asset quality trends signal HDFC Bank’s resilience in a competitive banking environment. The generous dividend declaration adds to the stock’s attractiveness for income-seeking investors. However, the slight year-on-year uptick in NPAs indicates the need for cautious monitoring of asset quality.
