India's largest private sector bank, HDFC Bank, will reveal its third-quarter financial results for the fiscal year 2026 today, Saturday, January 17. Market experts and brokerage firms anticipate the numbers to show little change from previous periods. The bank's core operations are holding steady, supported by moderate loan expansion and largely stable net interest margins.
Profitability Outlook
Analysts expect HDFC Bank to face some challenges in profitability compared to the last quarter. Net interest income might see a small increase quarter-on-quarter for the October-December period. However, overall profit growth could remain limited.
Seema Srivastava, a Senior Research Analyst at SMC Global Securities, notes that stable core earnings may be partly offset by weaker non-interest income and minimal treasury gains this quarter. This could restrain profit growth.
Different brokerages offer varying projections. Systematix predicts an 11.2% year-on-year rise in net profit for the December quarter. In contrast, Elara Capital forecasts a more modest 6.6% annual growth in net profit for Q3 FY26.
Net Interest Income and Asset Quality
Net interest income is likely to post modest year-on-year growth. Srivastava believes this will be aided by an expanding advances book and benefits from repricing. Yet, competitive pressures on deposits and high funding costs could limit margin expansion.
Asset quality should remain healthy. Credit costs and slippages are expected to stay under control, with no significant deterioration across loan segments anticipated.
At the consolidated level, Systematix analysts forecast HDFC Bank's net interest income to grow about 6.4% year-on-year in Q3 FY26. They estimate NII at ₹32,606.8 crore, reflecting a 3.3% increase from the previous quarter.
Elara Capital also expects asset quality to remain steady in Q3 FY26. They note that slippages should be curtailed, though the quarter might see slightly higher slippages due to it being a KCC quarter.
Loan Growth and Slippages
Loan growth is expected to remain healthy. Elara Capital anticipates better momentum in loan growth for the December quarter. They highlight that deposit traction and its composition, particularly in retail and other segments, will be key factors to watch. The credit-deposit ratio might rise within the 98-100% range.
Slippages could increase slightly on a sequential basis. However, provisions are likely to be lower compared to the previous quarter, according to Systematix. This is due to one-off higher provisions in the second quarter of FY26.
Market Focus
The Street's attention will be firmly on management commentary regarding deposit mobilization and margin trajectory. These factors are expected to drive the bank's performance in the coming quarters. Investors and analysts will scrutinize the bank's strategies to navigate current market conditions.
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies. We advise investors to consult certified experts before making any investment decisions.
