Housing Development Finance Corporation (HDFC), reported in-line standalone earnings performance for the quarter. Earnings at the PBT level, adjusted for dividends and sale of investments, for the company grew healthy at 21% yoy. Stable loan book growth of 14.9% and improvement in asset quality, were the key highlights from the results. NII for the company grew at healthy pace at 22.3% yoy whereas Non-interest income for the company came in at Rs 1.38 billion as compared to Rs 948 million in 2QFY2014. Operating income and pre-provisioning profit grew at 15.1% and 16.1% yoy.

Commenting on the result, Vaibhav Agrawal, VP research, banking, Angel Broking, said, ''Provisioning expenses for the company came in at Rs 350 million, higher than Rs 150 million in 2QFY2014. Overall, the company reported standalone earnings growth of 7.2% yoy at Rs 13.58 billion. Gross NPA improved by 10bp yoy to 0.69% as compared 0.79% in 2QFY2014. Currently, HDFC's core business trades at 4.2x FY2016E ABV, which in our view, offers limited scope for upside here on. Hence, we maintain our Neutral rating on the stock.''

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