HDFC slips in the afternoon trades with players booking profits even after the company posted splendid results that beat market expectation.

The scrip of the housing finance major shed 5.94% to Rs 324 on the BSE, came off from its high Rs 348.95 as well as recovered from its low of Rs 322. The stock registered a volume of over 124,000 shares by 13:40 IST. In last two sessions, between 2 and 6 May 2003, the scrip lost 4.14% to Rs 344.45 from Rs 359.35. Prior to that in four sessions, between 25 April and 2 May 2003, it rose by 22% to Rs 359.35 from Rs 295. Earlier, between 11 and 25 April 2003, the scrip, in eight sessions, lost 14.5% from Rs 344.95.

In the afternoon trades the scrip of HDFC registered its fourth quarter as well as full year results for the period ended 31 March 2003.

For Q4, the housing finance company recorded a net profit rise of 15.85% to Rs 239.19 crore (Rs 2.39 billion) compared to Rs 206.45 crore (Rs 2.06 billion) in the corresponding period of the previous year. Total income also increased by 9% to Rs 792.27 crore (Rs 7.92 billion) from Rs 726.54 crore (Rs 7.26 billion) in MQ 2002.

The 15.85% rise in net profit beats capitalmarket.com poll, which had expected the housing finance major to post a growth of 6% to 15% in its net profit, in the range of Rs 219 crore (Rs 2.19 billion) to Rs 238 crore (Rs 2.38 billion). Whereas the company recorded net profit of Rs 239.19 crore (Rs 2.39 billion). Meanwhile the poll predicted a net total income between Rs 301.5 crore (Rs 3.01 billion) and Rs 314 crore (Rs 3.14 billion).

For FY 2002-03 the company registered a net profit rise of 19% to Rs 690.29 crore (Rs 6.9 billion) on a 10.2% increase in total income to Rs 2,975.62 crore (Rs 29.75 billion). While on a consolidated basis for the full year ended 31 March 2003, the company recorded a net profit of Rs 747.48 crore (Rs 7.47 billion) on a total income rise of Rs 3,092.16 crore (Rs 30.92 billion).

Meanwhile the company also declared a dividend of Rs 11 per share.

Dealers said the fall in the scrip is on profit booking after the results. They said players had accumulated the stock in anticipation of the results and with the result meeting their expectation they booked profits.

Earlier there were reports that International Finance Corporation, a private sector funding arm of the World Bank, has approved loans amounting to $200-million loan to HDFC. The loans are dollar-denominated. HDFC is awaiting the government's approval before it avails of the loans. IFC has offered to provide two separate long-term loans - one loan amounting to $100-150 million for a period of eight years and the other, for $50-100 million for a tenure of six years.

The loans will go a long way in propping up HDFC's re-vitalised focus on the middle and lower income segment with attractive housing schemes. HDFC, the largest provider of housing loans in the country, has been hard-pressed by growing and aggressive competition from other home loan financiers like ICICI Bank and State Bank of India.

However, analysts feel going ahead competition in the housing finance sector is said to further intensify which is expected to eat its market share. HDFC faces increasing competition from players like ICICI Bank, State Bank of India and LIC Housing Finance.

As on 31 March 2003, institutions and the public held 59.70% and 15.52% equity stake in HDFC respectively.

BSE code: 500010