HDB Financial Q2 FY27: PAT up 34% YoY to ₹780 Cr, NPM expands to 15.6%, beats Street

HDB Financial Services' standalone PAT for Q2 FY27 came in at ₹780.2 Cr, up 34.2% YoY from ₹581.4 Cr, and roughly flat QoQ (-0.6%) against the record ₹785.2 Cr printed in Q1 FY27. Revenue from operations rose 10.1% YoY and 1.4% QoQ to ₹5,005.3 Cr. The print beat the ₹620-680 Cr PAT range the Street had pencilled in pre-result, while revenue landed within the ₹4,900-5,150 Cr expected band — profitability, not topline, was the surprise this quarter.

The beat was driven by operating leverage rather than a tax one-off: pre-tax profit rose 33.4% YoY to ₹1,043.7 Cr, and tax expense grew a similar 31.2% to ₹263.5 Cr, keeping the effective tax rate near 25.3%, in line with a year ago. Total expenses grew only 5.3% YoY to ₹3,961.6 Cr against 10.1% revenue growth — impairment/credit costs actually fell 2.5% YoY to ₹729.9 Cr even as the net loan book expanded to ₹1,20,379 Cr, while finance costs grew a slower 7.3% YoY than revenue. Net profit margin expanded to 15.59% from 12.79% a year ago, though it slipped 31bps sequentially from 15.90% in Q1, as impairment and finance costs both outpaced revenue quarter-on-quarter.

The stock went into the print at ₹584.55, down 12.6% over the past month of trading.

For context: this is the second-highest quarterly PAT of the last 6 quarters; revenue is at a 6-quarter high.

EPS (basic) ₹9.39 for the quarter vs ₹7.01 a year ago and ₹9.46 last quarter

Management's July guidance targeted NIM above 8%, a 2.5% ROA and steady-state credit costs near 2.3%. On the reported numbers, annualised ROA (quarterly PAT annualised over average total assets) works out to roughly 2.45% — essentially on target — while annualised credit cost of ~2.5% of average loans sits a touch above the 2.3% steady-state goal, though improving asset quality (Gross Stage 3 down to 2.43% from 2.81% YoY; Net Stage 3 down to 1.09% from 1.27%) supports the trend. At the segment level, Lending business PBT rose 35.6% YoY to ₹1,041.8 Cr and drove the quarter, while BPO services profit fell 37.8% YoY to ₹17.9 Cr; the filing does not break Asset Finance out from the combined Lending segment, so the promised sub-segment "pickup from Q2 onwards" can't be verified from these numbers alone. The company raised NCD funding through the quarter (including a ₹20,181 Cr allotment announced September 9, 2026), and the Board declared an interim dividend of ₹2.00/share (record date October 23, 2026) alongside results. No management press release accompanied this filing, so there is no fresh quarter-specific commentary beyond the July concall guidance to reconcile against.