HDB Financial reports stronger Q2 earnings

HDB Financial Services Limited (NSE: HDBFS) reported Q2 FY27 net profit of ₹780 crore, up 34.2% YoY. Net interest income increased to ₹2,534 crore from ₹2,193 crore a year ago, supported by loan growth and lower provisions. Key details • Net profit: ₹780 crore, up 34.2% YoY. • Net interest income: ₹2,534 crore versus ₹2,193 crore YoY. • Impairment stood at ₹730 crore, down from ₹748 crore a year ago. • The board also declared an interim dividend of ₹2 per share. The Economic Times My view The key positive is that profit growth is running well ahead of NII growth. Lower provisions are helping earnings, while demand for loans remains supportive. For an NBFC, however, strong profit growth needs to be backed by healthy asset quality and sustainable disbursements. So I would focus more on credit costs and loan-book growth than the headline PAT number alone. What I’m watching next I will watch disbursement growth in H2 FY27, credit costs and whether NII growth accelerates as the loan book expands. Stance: Positive on profitability and improving credit costs, but asset quality and loan growth remain the key factors to track. Disclosure: I do not have any holding or position in the stock mentioned above.