HDFC Ltd reaches the market cap of Rs 5 trillion
HDFC Ltd., an Indian financial services company which specializes in housing finance today reached Rs 5 trillion in market capitalization when its stock price reached a lifetime high of Rs 2808 on the Bombay Stock Exchange.
HDFC Ltd has now become the sixth Indian company ever to have crossed the market cap of Rs 5 trillion, after Reliance Industries Ltd, Tata Consultancy Services Ltd, HDFC Bank Ltd, Hindustan Unilever Ltd, and Infosys Ltd.
For the October-December 2020 quarter, HDFC declared a consolidated profit of Rs2,930 crore, which was less by 65% compared to the same quarter of the previous fiscal. Net interest income was up at Rs 4000 crore by 25% and the profit from operations grew 29% to Rs 4190 crore.
This milestone can be attributed to the recent corrections in property prices backed by very low mortgage interest rates going around in the individual home loan sector. The housing industry had been hit hard when the lockdown started due to the COVID-19 pandemic but has made a very impressive recovery since. Housing Development Finance Corporation Ltd has directly corresponded to the growth.
Construction projects, however, have seen delays and low sales due to the lockdown which is expected to affect these financiers. Phillip Capital, a brokerage firm, said that “we believe that HDFC’s superior know-how of the segment; strict underwriting practices and buffer provision would help it to better manage the credit loss.”