HDB Financial Services Annual Report | Financials for 2022-23

HDB Financial Services Limited (HDB Financial) Return Comparision with Primex 40 Index

Periods	1 Week	1 Month	3 Months	6 Months	1 Year	3 Years	All Time
Primex-40
HDB Financial Services Limited

Balance Sheet of HDB Financial Services Limited (In Rs. Crore)

Particulars	2023	2022	2021
Assets
Financial Assets
Cash and Cash equivalents	653.82	683.97	976.4
Investments	1,243.25	2,233.51	1,592.90
Loans	66,382.67	57,162.45	58,601.40
Other financial assets	265.97	456.42	366.5
Total Financial Assets	68,545.71	60,536.35	61,537.30
Non Financial Assets
Tax assets	1025.98	1,064.51	787
Property, plant and equipment	122.37	78.14	91.5
Intangible assets	20.41	12.01	8
Other non-financial assets	335.92	202.49	217
Total Non-Financial Assets	1504.68	1,357.15	1,103.80
Total Assets	70,050.39	61.893.50	62,641.10
Equity And Liabilities
Equity share capital	791.40	790.44	789.2
Other Equity	10,645.57	8,749.29	7,657
Total Equity	11,436.97	9,539.73	8,446.2
Liabilities
Financial Liabilities
Payables	291.84	246.91	334.2
Borrowing and Debt securities	24,227.80	44,834.03	46,371.20
Subordinate liabilities	3,541.10	4,139.05	3,987.60
Other Financial liabilities	2,778.43	2,708.72	2,887.60
Total Financial Liabilities	57,935.58	51,928.71	53,580.70
Non-Financial Liabilities
Tax Liabilities	41.97	59.73	173.10
Provisions	368.96	314.75	319.80
Other non-financial liabilities	266.91	183.02	121.30
Total Non-Financial Liabilities	677.84	557.50	614.20
Total Equity And Liabilities	70,050.39	62,025.94	62,641.10

Profit & Loss Statement of HDB Financial Services Limited (In Rs. Crore)

Particulars	2023	2022	2021
Revenue from Operations	12,402.88	11,306.29	10,944.80
EBITDA	6251.16	4772	4,491.40
EBITDA margin	50.40%	42.20%	41.04%
Finance Cost	3,511.92	3,325.50	3,882.90
Depreciation	111.84	98.94	107.80
Profit Before Tax (PBT)	2,627.40	1347.56	500.70
Total Tax	668.05	336.16	109.20
Profit After Tax (PAT)	1,959.35	1,011.40	391.50
PAT margin	15.79%	8.95%	3.58%
Earnings per share basic (EPS) (In Rs.)	24.78	12.81	4.97
Earnings per share Diluted (EPS) (In Rs.)	24.76	12.80	4.97

HDB Financial Services Limited Cash Flow Statement for the last three years (In Rs. Crore)

Particulars	For the year ended March 31, 2023	For the year ended March 31, 2022	For the year ended March 31, 2021
A. CASH FLOW FROM OPERATING ACTIVITIES
Profit/(loss) before tax	2,627.40	1,347.56	500.71
Adjustments for
Interest Income	(8,927.78)	(8,362.97)	(8,487.88)
Interest Expenses	3,502.92	3,316.64	3,857.22
(Profit)/loss on sale of asset	(1.01)	(0.06)	1.91
Realised net loss/ (gain) on FVTPL investments	(90.67)	39.29	(79.75)
Unrealised gain on FVTPL investments	5.60	(22.81)	(5.15)
Discount on commercial paper	9.00	8.86	25.71
Provision for compensated absence and gratuity	6.59	3.52	15.78
Employee share based payment expenses	43.64	30.42	13.55
Depreciation, amortization and impairment	111.84	98.94	107.79
Impairment on financial instruments	1,330.40	2,465.73	3,065.52
Operating cash flow before working capital changes	(1,382.07)	(1,074.88)	(984.59)
Adjustments for working capital changes:
(Increase)/ decrease in Loans	(10,462.68)	(1,016.51)	(3,695.31)
(Increase)/ decrease in trade receivables	76.06	(24.50)	8,447.48
(Increase)/ decrease in other financial assets and others	(0.19)	(17.69)	(4,482.17)
Increase/(decrease) in other financial and non financial liabilities & provisions	(758.28)	(960.09)	66.12
Increase/(decrease) in trade payables	44.93	(87.34)	(65.41)
Cash generated from/(Used in) operations before adjustments for interest received and interest paid	(12,482.23)	(3,181.01)	7.85
Interest Paid	(3,842.14)	(3,699.47)
Interest Received	8,841.36	8,353.15	184.28
Cash generated from/(Used in) operations	(7,483.01)	1,472.67	(521.75)
Direct taxes paid (net of refunds)	632.41	514.43	180.00
Net cash flow generated from/(used in) operating activities (A)	(6,850.60)	1,987.10	(341.75)
B. CASH FLOW FROM INVESTING ACTIVITIES
Purchase of investments	(49,267.66)	(24,583.62)	(15,557.50)
Sale of investments	50,350.80	23,920.20	15,713.15
Purchase of fixed assets	(111.32)	(41.13)	(24.64)
Sale of fixed assets	1.50	1.27	0.38
Net cash generated (used in)/ from investing activities (B)	973.32	(703.28)	131.38
C. CASH FLOW FROM FINANCING ACTIVITIES
Debt securities issued	10,099.18	8,876.00	10,541.10
Debt securities repaid	(8,210.60)	(7,274.50)	(9,378.90)
Borrowings other than debt securities issued	17,207.75	8,800.35	9,309.34
Borrowings other than debt securities repaid	(12,507.21)	(12,026.41)	(10,195.20)
Subordinated debt issued	-	150.00	356.50
Subordinated debt repaid	(600.00)	-
Proceeds from issue of shares and security premium	33.93	37.89	36.87
Repayment of lease liabilities	(76.81)	(62.87)	(61.78)
Dividend paid	(150.25)	-
Net cash generated (used in)/ from financing activities (C)	5,795.99	(1,499.54)	607.93
Net (decrease)/increase in cash and cash equivalents (A+B+C)	(81.30)	(215.72)	397.56
Add : Cash and cash equivalents as at the beginning of the year	477.20	692.92	355.95
Cash and cash equivalents as at the end of the year *	395.90	477.20	753.51
*Components of cash and cash equivalents
Balances with banks	358.51	430.81	650.42
Demand drafts on hand	8.87	11.32	12.88
Cash on hand	28.52	35.07	29.62
	395.90	477.20	753.51

Summary of HDB Financial Services Limited 's Cash Flow Statement for the last three years

1. Operating Activities:

- The net cash flow generated from operating activities for the year ended March 31, 2023, was (Rs. 6,850.60 Crore) compared to Rs. 1,987.10 Crore in the previous year, showing a significant decrease in cash generated from operations.

- The company 's operating cash flow was negative in all three years, indicating that its core business operations were consuming more cash than they were generating.

2. Investing Activities:

- The net cash flow generated from investing activities for the year ended March 31, 2023, was Rs. 973.32 Crore, compared to a negative (Rs. 703.28 Crore) in the previous year.

- The company made significant investments in each year, but it also realized gains by selling some of these investments.

3. Financing Activities:

- The net cash flow generated from financing activities for the year ended March 31, 2023, was Rs. 5,795.99 Crore, compared to a negative (Rs. 1,499.54 Crore) in the previous year.

- The company issued debt securities, borrowed funds, and raised capital through the issue of shares and security premium. It also repaid debt and subordinated debt in certain years.

4. Overall Cash Flow:

- The net decrease in cash and cash equivalents for the year ended March 31, 2023, was Rs. 81.30 Crore, compared to a decrease of Rs. 215.72 Crore in the previous year.

- The company had positive cash flow for the year ended March 31, 2021, with an increase of Rs. 397.56 Crore.

5. Cash and Cash Equivalents:

- The cash and cash equivalents at the end of the year stood at Rs. 395.90 Crore for the year ended March 31, 2023, compared to Rs. 477.20 Crore and Rs. 753.51 Crore for the years ended March 31, 2022, and March 31, 2021, respectively.

- The company maintained balances with banks, demand drafts on hand, and cash on hand as components of its cash and cash equivalents.

Overall, the cash flow statement indicates that HDB Financial Services Limited experienced a negative cash flow from operating activities in all three years, but it managed to have a positive net cash flow due to activities in investing and financing. However, there was a decrease in cash and cash equivalents over the three-year period, indicating a possible need to monitor cash flow management and financial performance.

HDB Financial Services Share Dividend History

Particulars	2023	2022	2021	2020
Dividend (In Rs.)	1.10	1.00	NIL	Nil

Performance of HDB Financial Services Limited

HDB Financial services total revenue from operations increased slightly by 9.69% in FY 2023, from Rs. 11,306.29 Crores in FY 2022 to Rs. 12,402.88 Crores in FY 2023.
EBITDA of the company has increased by 31% in FY 2023 to Rs. 6251.16 Crores from Rs. 4772 Crores in FY 2022. Due to this EBITDA margin also increased from 42.20% in FY 2022 to 50.40% in FY 2023.
The company’s Profit after Tax has seen a growth of 93.72% from Rs. 1011.40 Crores in FY 2022 to Rs. 1959.35 Crores in FY 2023.
The company’s Asset under Management (AUM) increased by 14.06% to Rs. 70,084 Crore in FY 2023 from Rs. 61,444 crore in FY 2022.
On March 31, 2023, Capital Adequacy Ratio was 20.05%. Which is sufficiently above the minimum regulatory norms for non-deposits accepting NBFCs.
In the financial year 2022-23, the company paid a dividend of Rs. 1.10; in the previous year, the company paid dividend of Rs. 1.00.