HDFC

BRICK BY BRICK GROWTH STORY

Presented by:
Kadambari Koli (B-06)
Vishal Kothari (B-09)
Richa Priya (B-16)
Nayan Savla (B-19)
Chaitali Shah (B-21)
Nayan Shah (B-23)
Rachna Sohoni (B-37)
 Overview of
Housing Finance
Industry
Mortgage as a % of GDP
HDFC Ltd

Established in 1978

Promoted with an initial share capital of Rs.
100 million.

Revamped Indian housing finance industry
 
Objectives of HDFC

To cater social need - promoting home
ownership by providing long-term
finance


To enhance residential housing stock in
the country


Organizational goals

 Develop close relationships with individual
households

 Maintain its position as the premier housing
finance institution in the country

 Transform ideas into viable and creative
solutions

 Provide consistently high returns to shareholders

 To grow through diversification by leveraging off
the existing client base

HDFC Founder

 Man with a mission- trend setter in Indian financial
history



 Had vision for mortgage finance for housing, gave

birth to the Housing Development Finance
Corporation



 Started career with newely formed ICICI



 1992 -Government of India honored him with the
Padma Bhushan Award
Milestone – 30 years
Core Services provided by
HDFC

 Home loan

 Home Improvement loan

 Home Extension loan

 Short term bridging loan

 Land purchase loan

 Loans to Professionals for Non Residential Premises
Loan


 Home equity loans

Awards & Accolades

 HDFC selected as the 'Top Indian Company in FIs / NBFCs /
Financial Services sector' for the Dun & Bradstreet –
Rolta Corporate Awards 2008

 Mr. Deepak Parekh awarded the 'Business Leader of the
Year' by NDTV

 Mr. Deepak Parekh conferred with the ‘CNBC Awaaz-CRISIL
Lifetime Achievement Award for Outstanding
Contribution to Real Estate’

 Ranked 3rd amongst the Asian Banking and Finance
Sector for ‘Highest Return on Equity’ by Asia money
 Centre for housing finance
 HDFC's Training Centre

 Located in the serene ambience of Lonavla

 Provides
ü Technical assistance to national governments and housing
finance institutions…..
ü Managerial training for housing finance institutions…..
ü
 Corporate clients includes
ü Bajaj Electricals Ltd
ü Colgate-Palmolive India Ltd
ü Crompton Greaves India Ltd
ü HSBC Bank
ü Kotak Mahindra Finance Ltd…
Associate Companies
Other Subsidiaries

HDFC Trustee Company Ltd.
GRUH Finance Ltd.
HDFC Developers Ltd.
HDFC Property Ventures Ltd.
HDFC Ventures Trustee Company Ltd.
HDFC Investments Ltd.
HDFC Holdings Ltd.
Credit Information Bureau (India) Ltd
HDFC Securities
Holdings
 HDFC BANK
 HDFC Bank was incorporated in August 1994

 Among the first in new generation commercial
banks

 Registered office in Mumbai, India

 Promoted by HDFC, the parent company

 IPO in India in 1995

 Listed in NSE, BSE, NYSE(ADR)
NETWORK
 1416 branches

 3570 ATM’s in the country

 550 cities in India

 All branches are OLRT
connected

 500 locations serviced through
Telebanking

 Representative offices in Hong
Kong, New York, London &
Singapore

Business Focus
 World Class Indian Bank

 Benchmarking against international standards.

 Best practices in terms of ethical standards,

professional integrity, corporate governance and

regulatory compliance
 To build sound customer franchises across distinct

businesses.
 Four core values - Operational Excellence,

Customer Focus, Product Leadership and People.

Offerings


Wholesale Banking Services

Retail Banking Services

Treasury
Business Strategy
 Increasing market share in India’s expanding
banking.

 Delivering high quality customer service.

 Delivering more products to more customers.

 Maintaining current high standards for asset
quality through disciplined credit risk
management.

 Develop innovative products and services that
Achievements

 HDFC Bank merged with TIMES BANK in 2000.
 HDFC Bank merged with CENTURION BANK OF
PUNJAB in 2007.
 HDFC Bank wins the Asian Banker Best Retail
Bank in India Award 2008 for outstanding
performance.
 HDFC Bank chosen as one of Asia Pacific’s best
50 companies by Forbes magazine.
 'Best Bank in the Private Sector 2008.'
 HDFC Bank ties up with Qatar National Bank.
 Milestones !!!!

 HDFC follows the model of a sound corporate

governance

 The bank was amongst the first four companies,
which subjected itself to a Corporate
Governance and Value Creation (GVC) rating by
CRISIL

 A very sound and effective risk management
system in place to create a less risk assets
portfolio

 Uses Neural Technologies for risk management in
its Credit Cards and other Retail Assets portfolios
HDFC AMC
Incorporated on 10th December, 1999
Approved as AMC for HDFC Mutual Fund on
3 rd July, 2000
Particulars % of the paid up equity capital
 HDFC Limited 60

 Standard Life Investments Limited 40


Zurich India Mutual Fund divested its Asset
Management business in India
HDFC AMC acquired Zurich’s Schemes on
19th June, 2003

VISION
Why HDFC Mutual Fund???


Investment Philosophy
Offerings
Achievements
As on 30 September 09
Average Asset under Management: Rs. 90,427.25
cr. 
No. of investors: 3,283,463 
No. of ARN certified distributors: 30,282
 HDFC Standard Life


Joint Venture between


Company’s Name Percentage holding

HDFC Ltd. 72.43
 Standard Life (Mauritius) 26.00
2006
Financial Expertise
Range of Solutions
Track Record So Far
Gross Premium Income – Rs. 5564.69 crs
27 lakh policies in force

Vision

'The most successful and admired life
insurance company, which means that we
are the most trusted company, the easiest
to deal with, offer the best value for
money, and set the standards in the
industry'.

'The most obvious choice for all'.

HDFC Ergo General
Insurance

74:26 Joint Venture between HDFC Ltd. &
ERGO International AG

“Right Insurance Solution” for ALL

46 cities with 52 branch offices with an
employee strength of 650 professionals
Vision


"To be the most admired insurance
company that enables the continued
progress of customers by being
responsive to their needs"
Values

Sensitivity

Excellence

Ethics

Dynamism
HDFC Realty

Wholly Owned Subsidiary of HDFC Ltd.

Facilitating Buying, Selling or Leasing of
Residential/Commercial Property

Geographic Reach - Mumbai, Navi Mumbai,
Pune, Bangalore, Delhi / NCR, Kolkata,
Kochi & Hyderabad.
“HR Perspective At HDFC”
 Strategic Human Resource
 Linking of human resources with strategic goals and objectives

 Involving HR function as a strategic partner.

 Actions undertaken by HR dept to make their role strategic

Ø Aligning people with strategy
Ø
Ø Empower managers and employees
Ø
Ø Drive leadership development

 “ HDFC's finest investment is in its Human Resources. It draws
its personnel from many disciplines. They are the building
blocks on which the company's performance & productivity is
based”


 -H T Parekh
Culture & Values at HDFC
Training at HDFC
§
§ Programmes are based on upgradation of competencies and
skills.
§
§ New training initiatives in Lead Management, rural housing,
cross selling of financial products.
§
§ Training programmes on Personal Effectiveness, Leadership
Excellence, Art of Living.
§
§ Guest Lecturers and Tie up with IIM Ahemdabad
Recruitment Practices at HDFC
 Campus Recruitment at Tier one campus


 Localisation Strategy


 No Lateral recruitment
CSR Initiatives by HDFC

 To make a positive impact on economic and human
development.


 Shelter Assistance Reserve
Sense India
Mobile Creches
Sahaj
Deep Griha Society
Comparison of HDFC & ICICI Bank HR
Practices
Parameters HDFC Bank ICICI Bank

Employee Strength 52687(March’09) 36,000(Jun’09)

Recruitment Concentrates on Concentrates on lateral

Localization strategy recruitment/Interview
Centers

Training “Karo Sifarish” & “Back Training Talents

Pack Trainers
Financial analysis of
HDFC ltd
Core business
H D FC LT D .
Balance sheet of HDFC
(liabilities)
Balance sheet of HDFC
(assets)
Continuing growth
momentum
Sources of mortgages at
HDFC ltd
Loan profile
Fund raising at HDFC
Consistent performance
Utilisation of reserves
Income generated & expenditure
incurred
Sum of the parts valuation
method
Subsidiaries of HDFC
Financials of
subsidiary
HDFC bank
HDFC standard life
Average premium
AUM
Expense ratio
Claims repudiation ratio
Result (Q2)
&
Ratio analysis
 Ratio analysis
Company Market Cap P/E (TTM) P/BV EV/EBIDTA ROE ROCE D/E
(Rs. in Cr.) (x) (TTM) (x) (%) (%) (x)
(x)
HDFC 78,984.82 31.5 6.0 11.5 18.2 12.0 6.1
LIC Housing Fin. 7,551 13.7 2.6 9.8 26.2 11.0 11.3
Dewan Housing 1,618.89 15.9 2.1 9.2 20.6 11.5 10.9
GRUH Finance 810 14.8 3.7 7.1 24.5 12.2 9.8
GIC Housing Fin 526.38 9.1 1.5 8.6 17.2 11.0 6.9
Can Fin Homes 181 5.1 0.7 7.9 13.5 11.1 7.2
Sahara Housing 130.45 70.9 6.3 9.9 8.9 11.2 5.7
SBI Home Finance 23 0.0 -0.1 0.0 0.0 0.0 0.0
Coral India Fin. 19.87 48.2 0.8 10.4 18.5 21.1 0.0
Ind Bank Housing 15 0.0 -0.3 17.5 0.0 0.0 0.0
India Home 8.03 25.9 2.2 0.0 2.3 -1.8 0.0
Happy Home Profi 6 24.5 1.0 0.0 3.4 5.4 0.1
Manraj Hsg.Fin. 5.45 54.5 0.9 20.5 2.9 4.9 0.5
Intl. Housg.Fin. 4 230.0 0.2 0.0 0.0 0.0 0.0
Parshwa.Hsg.Fin. 4.07 0.0 1.3 0.0 20.2 12.9 1.3
Half year result analysis SEPT, 09
Key highlight of result SEPT, 09
Loan approvals and disbursements up 18%
& 26%

Profit on sale of investment up 171% @61.2
crores

10.9 mn. warrants @ 275 converted @ 3000

Raised 4000 crore by 2-3 year NCD @ 7-8%

Gain from unrealised investment is 13,300
crores
 STP ANALYSIS
vSegmentation
 Corporate
 SMEs
 NRIs
 Personal


vTarget
 Retail
 Wholesale
 Capital market
STP ANALYSIS
v
vPositioning
 AAA rating
 High standard services
M a rke tin g M ix in Fin a n cia l
S e rvice s
Pro d u ct

Price Pe o p le P la ce

Pro m o tio n
PRODUCT MIX
 HDFC Ltd


 Home Improvement Loans

 Flat, row house, bungalow from developers
 Existing freehold properties
 Properties in an existing or proposed co-operative housing society or
apartment
 Owner's association

 Home Extension Loans
To facilitate the extension of an existing dwelling
unit.
The maximum amount of such a loan is Rs. 100 lacs
or 100% of the cost of extension, whichever is
lower
 Maximum duration of 20 years and is to be repaid in
equated monthly installments

 Home Conversion Loans
Existing HDFC borrowers can avail of a Home
Conversion Loan to acquire another dwelling unit,
through sale of the existing dwelling unit
The existing loan gets transferred to new property
with the increased loan amount
Saves the prepayment processing charges for loan
conversion

 Top - Up Loans
Encashing the investment in a house without having
to dispose it off to fund various needs related to
Higher Education, Purchase of Furniture, Business
Requirements.
The maximum term of the loan is 10 years. Top up
loans can given after 1 to 2 years of the final
disbursement of the existing loan or upon
possession/completion of the existing financed
 PRICING MIX
 Home Loan
 Maximum loan
85% of the cost of the property and based on the
repayment capacity of the customer.
 Maximum Term
20 years subject to your retirement age.
 Applicant and Co- Applicant to the loan
 Adjustable Rate Home Loan
 Fees


 Home Improvement Loan

 Maximum loan
 Existing customer
 New customer
Maximum Term
Applicant and Co- Applicant to the loan

Fees.

No Charges for

 Replacement of cheques
 Income Tax Certificates
 Accelerated Repayment Option  


Land Purchase Loan

Maximum loan

Maximum Term

Applicant and Co- Applicant to the loan

Adjustable Rate Home Loan

Fees

 No Charges for
 Replacement of cheques
 Income Tax Certificates
 Accelerated Repayment Option
PROMOTION MIX:
 RSCG India recently launched two TVC campaigns for HDFC
Bank titled 'Moon' and 'Lost Boy'.
 launched its life insurance campaign, ‘Papa kabhi
bhi Gum Nahin Honge’in 08
 This campaign was launched with 360 degree
approach
 Tag line “we understand your world”…making its
presence felt
 The message is clear and consumer connect is
ubiquitous

 360 degree Approach

H D F C 's In te rn a tio n a l S ilv e r

C re d it C a rd - T h e ca rd fo r
w h e re v e r y o u g o