Demand for home loans has remained strong even during the Covid-19 pandemic, Housing Development Finance Corporation (HDFC) President Deepak Parekh said on Tuesday at the property financier’s 44th Annual General Meeting (AGA). Although Parekh acknowledged that the foreclosure restrictions were having an impact on individual loans, he said demand exceeded all expectations once the restrictions were relaxed.
“The pandemic has reaffirmed that there can be no greater security in life than a home. The inherent demand for home loans continues to remain strong, ”Deepak Parekh, chairman of HDFC, told the company’s AGM on Tuesday. The latest data from the Reserve Bank of India (RBI) also asserts continued growth in mortgage lending in the system. Home loans increased 10% year-on-year (year-on-year) to 14.62 lakh crore, as of May 21, 2021, according to RBI.
Even in terms of commercial real estate, most companies have not relinquished their offices, Parekh said. With the boom in e-commerce, demand for real estate is coming from warehousing and distribution centers, he added. Likewise, with the establishment of digital infrastructure, the demand for data centers has increased. These are segments of the real estate industry that have the potential to grow tremendously, he added.
In the context of the pandemic, Parekh said HDFC explained that there are three main controllable elements – liquidity, growth and asset quality. The company has always been cautious in identifying loans where there could be stress and has adequately scheduled such loans, he said. Parekh also pointed out that asset quality has been difficult for non-individual loans at the system level.
As of March 31, 2021, HDFC’s gross non-performing loans amounted to Rs 9,759 crore, constituting 1.98% of the loan portfolio. Its assets under management increased 10% to Rs 5,69,894 crore as of March 31, 2021. The housing finance major reported a 42% year-on-year growth in net profit to Rs 3,180 crore over the course of the year. of the March quarter (T4FY21). The lender is expected to report its June quarter results (T1FY22) on August 2, 2021.