HDB Financial Services Annual Report | Balance Sheet

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

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HDB Financial Services Limited

HDB Financial Services Limited Consolidated Balance Sheet (Rs in Crores)

Particulars	31-03-2025	31-03-2024
Financial Assets
Cash and cash equivalents	950.46	647.85
Bank balances other than (a) above	33.81	54.66
Derivative financial instruments	108	1.91
Trade receivables	225.17	124.61
Loans	1,03,343.04	86,721.26
Investments	2,060.13	3,380.33
Other financial assets	47.65	39.5
Non-Financial Assets
Current tax assets (Net)	76.89	41.29
Deferred tax assets (Net)	883.25	939.95
Property, plant and equipment	243.12	162.53
Other intangible assets	32.3	22.15
Right of use Assets	459.67	326.51
Other non-financial assets	199.8	93.96
Total Assets	1,08,663.29	92,556.51
Financial Liabilities
Derivative financial instruments	2.06	4.77
Trade payables:
Total outstanding dues of creditors other than micro & small enterprises	452.68	509
Debt securities	39,465.17	34,851.12
Borrowings (other than debt securities)	41,928.89	33,831.38
Subordinated liabilities	6,003.71	5,648.17
Other financial liabilities	3,944.08	2,955.27
Non-Financial Liabilities
Current tax liabilities (net)	65.66	58.65
Provisions	564.51	502.94
Other non-financial liabilities	416.78	452.5
Equity
Equity share capital	795.78	793.08
Other equity	15,023.97	12,949.63
Total Liabilities and Equity	1,08,663.29	92,556.51

HDB Financial Services Limited Consolidated Profit & Loss Statement (Rs in Crores)

Particulars	31-03-2025	31-03-2024
Revenue from operations
Interest income	13,835.79	11,156.72
Sale of services	1,216.66	1,949.55
Other financial charges	1,192.45	953.11
Net gain on fair value changes	54.92	113.69
Net gain/(loss) on derecognition of financial instruments under amortised cost category	0.46	-1.95
Total Revenue from operations	16,300.28	14,171.12
Expenses
Finance Costs	6,390.15	4,864.32
Impairment on financial instruments	2,113.05	1,067.39
Employee Benefits Expenses	3,619.57	3,850.75
Depreciation, amortisation and impairment	194.42	145.14
Others expenses	1,055.29	938.85
Total Expenses	13,372.48	10,866.45
Profit/(loss) before tax	2,927.80	3,304.67
Current tax	739.19	770.67
Deferred tax (credit)	72.8	73.16
Income tax for earlier year	-60.11	-
Profit for the year	2,175.92	2,460.84
Other Comprehensive Income
Items that will not be reclassified to profit or loss:
Remeasurement loss on defined benefit plan	-9.48	-31.54
Income tax relating to items that will not be reclassified to profit or loss	2.38	7.94
Items that will be reclassified to profit or loss:
Movement in cash flow hedge reserve	-54.5	-17.1
Income tax relating to items that will be reclassified to profit or loss	13.72	4.3
Other Comprehensive Income	-47.88	-36.4
Total Comprehensive Income for the year	2,128.04	2,424.44
Earnings per equity share
Basic	27.4	31.08
Diluted	27.32	31.04

HDB Financial Services Limited Consolidated Cash Flow Statement (Rs in Crores)

Particulars	31-03-2025	31-03-2024
Cash Flow From Operating Activities
Profit/(loss) before tax	2,927.80	3,304.67
Adjustments for
Interest Income	-13,835.79	-11,156.72
Interest Expenses	6,263.50	4,771.63
(Profit)/loss on sale of asset	-0.2	-0.85
Realised net loss/ (gain) on FVTPL investments	-58.21	-89.91
Unrealised net loss/(gain) on FVTPL investments	3.29	-23.78
Discount on commercial paper	99.25	77.01
Provision for compensated absence and gratuity	11.54	29.87
Employee share based payment expenses	62.48	55.24
Depreciation, amortisation and impairment	194.42	145.14
Impairment on financial instruments	2,113.05	1,067.39
Operating cash flow before working capital changes	-2,218.87	-1,820.31
Adjustments for working capital changes:
(Increase)/ decrease in Loans	-18,720.91	-21,405.98
(Increase)/ decrease in trade receivables	-99.52	-58.85
(Increase)/ decrease in other financial assets and others	-400.29	291.32
Increase/(decrease) in other financial and non financial liabilities & provisions	712.06	-44.6
Increase/(decrease) in trade payables	-56.32	217.16
Cash generated from/(Used in) operations before adjustments for interest received and interest paid	-20,783.84	-22,821.26
Interest Paid	-5,810.74	-4,110.50
Interest Received	13,663.02	10,946.14
Cash generated from/(Used in) operations	-12,931.56	-15,985.62
Direct taxes (paid)/net of refunds	-694.77	-750.42
Net cash flow generated from/(used in) operating activities	-13,626.33	-16,736.04
Cash Flow From Investing Activities
Purchase of investments	-42,427.90	-52,917.26
Sale of investments	43,794.86	50,893.87
Purchase of fixed assets	-209.79	-123.35
Sale of fixed assets	1.85	1.18
Net cash generated (used in)/ from investing activities	1,159.02	-2,145.56
Cash Flow From Financing Activities
Debt securities issued	26,223.00	22,167.71
Debt securities repaid	-21,566.00	-14,490.01
Borrowings other than debt securities issued	43,193.59	29,910.87
Borrowings other than debt securities repaid	-35,223.72	-20,307.29
Subordinated debt issued	857	2,337.07
Subordinated debt repaid	-500	-230
Proceeds from issue of shares and security premium	124.62	71.45
Repayment of lease liabilities	-100.47	-80.87
Dividend paid	-238.1	-245.38
Net cash generated (used in)/ from financing activities	12,769.92	19,133.55
Net (decrease)/increase in cash and cash equivalents	302.61	251.95
Add : Cash and cash equivalents as at the beginning of the year	647.85	395.9
Cash and cash equivalents as at the end of the year	950.46	647.85
Components of cash and cash equivalents
Balances with banks	909.61	606.1
Demand drafts on hand	5.63	6.3
Cash on hand	35.22	35.45
Total	950.46	647.85

Here is a summary of the Cash Flow Statement for the years 2025 and 2024:

Cash Flow From Operating Activities

The company started with a profit before tax of ₹2,927.80 crore in 2025, slightly lower than ₹3,304.67 crore in 2024. However, a significant amount of adjustments were made, particularly reflecting high interest income (₹13,835.79 crore in 2025, ₹11,156.72 crore in 2024) and interest expenses (₹6,263.50 crore in 2025, ₹4,771.63 crore in 2024). Other notable adjustments include impairments on financial instruments (₹2,113.05 crore in 2025) and depreciation (₹194.42 crore in 2025). After adjustments, the operating cash flow before working capital changes was negative at ₹-2,218.87 crore in 2025, indicating that operating profitability was heavily offset by non-cash adjustments.

The company also saw large increases in loans (₹-18,720.91 crore in 2025) and minor changes in trade receivables and payables, indicating significant outflows towards lending and working capital. After adjusting for these changes and adding interest paid and received, the net cash flow from operations was negative ₹-13,626.33 crore in 2025 (compared to ₹-16,736.04 crore in 2024).

Cash Flow From Investing Activities

The company engaged in considerable purchase of investments (₹-42,427.90 crore in 2025 and ₹-52,917.26 crore in 2024) but also generated cash from sale of investments (₹43,794.86 crore in 2025). The purchase and sale of fixed assets were minimal, showing little capital expenditure. Consequently, the net cash generated from investing activities was positive at ₹1,159.02 crore in 2025, indicating net cash inflow from investing despite large-scale investment activities. This is a turnaround from the previous year (₹-2,145.56 crore), showing improved investment performance.

Cash Flow From Financing Activities

The company was active in raising funds, with debt securities issuance of ₹26,223 crore in 2025 and borrowings of ₹43,193.59 crore. There were also significant repayments (debt securities repaid at ₹-21,566 crore and borrowings at ₹-35,223.72 crore). Smaller amounts were involved in subordinated debt, equity issuances, lease repayments, and dividends. The net cash from financing activities was ₹12,769.92 crore in 2025, showing strong net inflows from financing, though it was lower than the ₹19,133.55 crore in 2024.

Cash Flow and Closing Balances

Combining all three sections, the company experienced a net increase in cash and cash equivalents of ₹302.61 crore in 2025 (compared to ₹251.95 crore in 2024). The cash and cash equivalents at the end of the year totaled ₹950.46 crore, reflecting a healthy liquidity position, driven primarily by financing activities, which offset the cash consumed in operating activities.

The components of cash and cash equivalents included balances with banks, demand drafts, and cash on hand, with balances with banks being the major component (₹909.61 crore in 2025).