• As India’s largest private sector bank, we at HDFC Bank have always stayed strong to our commitment to positively impact the environment, our customers, employees, and the community at large. Our core values have guided our ESG practices, which seek to drive growth and empower communities through our corporate decision-making processes.
  • In FY 2014-15, sustainability was officially included as our fifth value, alongside customer focus, operational excellence, product leadership, and people. This is testament to the fact that sustainability is now a part of our DNA. It is an area of heightened focus and investment for us, and has changed our outlook towards our business.
  • This approach is in perfect alignment with our strategic goals as an organisation and the experience we seek to offer our customers. For in the spirit of data-driven transparency, the present-day consumer not only expects, but is rightly entitled to information on corporate operations and processes. Customers are increasingly choosing private and public companies that maintain high levels of transparency and ethics in their business practices. And we believe that our ESG and Sustainability disclosures give them exactly that.
  • We understand fully that our identity as a world class Indian bank is shaped by our stakeholders and customers. They are at the heart of of everything we do. Which is why we leave no stone unturned in delivering value to our customers, to the community, or to our workforce. We ensure a fair recruitment process that helps us identify and hire people with the right values, who are then groomed, encouraged and retained through a combination of financial and non-financial incentives.
  • As one of India’s largest corporations, we consider it both an honour and our responsibility to work towards the betterment of the country and its people. The philosophy of Parivartan informs how we go about achieving this. To bring about Parivartan, we first need to imagine a future we want – one that is fair, equal, happy and healthy. With that vision in mind, we deploy social development initiatives that take on myriad forms, guided by different strategies. But ultimately, the objective is to create Parivartan and become catalysts of positive transformation at the organisational level and in the communities wherein we operate.
  • The Indian economy faced several headwinds both domestic and external for much of the year ended March 31, 2019. Encouragingly, despite global headwinds like volatile oil prices, elevated trade tensions, geo-political uncertainties in some parts of the world and interest rate tightening cycle in some of the developed countries notably the US, the Indian economy stood out as an outlier in terms of growth with an estimated growth of 7 per cent in the year under review (as per the second advance estimates of the Central Statistics Office).
  • On an annual basis, GDP growth is expected to drop to 7 per cent in 2018-19 from 7.2 per cent in 2017-18. From the production side, the current slowdown is mainly on account of the agriculture sector (due to weak kharif season), which is expected to grow at a lower rate of 2.7 per cent in the year under review from 5 per cent in the previous year.
  • The financial performance of your Bank during the year ended March 31, 2019, remained healthy with Total Net Revenue (Net Interest Income Plus Other Income) rising by 19.1 per cent to 65,869.1 crore from 55,315.2 crore in the previous year. Revenue growth was driven by an increase in both Net Interest Income and Other Income. Net Interest Income grew by 20.3 per cent to 48,243.2 crore due to acceleration in loan growth coupled with Core Net Interest Margin (CNIM) of 4.3 per cent.
  • Your Bank’s Retail Banking Business registered robust growth in the year under review. Total Retail Deposits grew by 22.3 per cent to 709,085 crore from 580,006 crore in the preceding year while Retail Advances rose by 15 per cent to 432,687 crore from 376,167 crore.
  • Digitalisation has been the key with your Bank emerging as a pioneer in various digital loans be it the 10 second Personal Loan, Digital Loan Against Shares and more recently Loan Against Mutual Funds. All these are industry firsts.
  • The Bank distributes Life Insurance, General Insurance and Mutual Funds, often referred to as Third-Party Products. Income from this business grew by 5 per cent to 2,200 crore from 2,091 crore crore and accounted for 16 per cent of Total Fee Income in the year ended March 31, 2019 compared with 18 per cent in the preceding year.
  • Global headwinds like trade wars, interest rate hike by the US coupled with domestic concerns like depreciating currency, FPI outflows and impact of default by IL&FS to other companies dampened market sentiment.
  • Loans against Gold Jewellery grew to over 5,900 crore from over 5,500 crore the preceding year. Your Bank is slowly making inroads into a market traditionally dominated by the unorganised sector and pawn brokers.
  • Training plans for businesses are developed based on needs identified in consultation with the business leaders. An extensive bouquet of training programmes are delivered, covering on-boarding, product and process training, advanced programmes and behavioral training. The on-boarding training ensures that new employees are trained comprehensively and equipped with necessary know-how, as well as functional and behavioral skills required for the proper discharge of the role.
  • With its ever-growing network of 1,350 branches across 961 cities/towns, HDBFS is reaching out to customers spread across the country. Over 85 per cent of its branches are outside the top 25 cities of India. This means that a branch and customer relationship manager are never too far from the customer.
  • Another revenue stream for the company has been Business Process Outsourcing (BPO) solutions to HDFC Bank. The BPO services division delivers back-office services such as forms processing, documents verification, finance and accounting services and correspondence management. HDBFS also delivers front office services such as contact centre management, outbound marketing and collection services.
  • It has been a challenging year for the Indian economy externally as well as internally. The good news is that despite the challenges of volatile oil prices, trade wars, rising interest rates, and domestic uncertainties due to the impending general elections in India and slowing consumption demand, India remained the world’s fastest growing economy. Your Bank which grew faster than the system in the year under review is well poised to tap the opportunities of what is still an under penetrated market by leveraging its strong balance sheet and franchise. As always, your Bank will continue to be judicious. It will continue to leverage its distribution strength and digital platforms to offer a similar experience to customers across urban, semi-urban and rural India.

My view: HDFC Bank remains the darling of the street and for the right reasons. It also has the chickens(customers) as it fights against the online players. However, a time correction in the stock for the next 2-3 years cannot be ruled out.

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