HDFC twins merger: Here’s how HDFC Bank traded on Day 1 post amalgamation

Shares of HDFC Bank, following merger with its parent Housing Development Finance Company (HDFC), gained as much as 1.4% on the first day of trading of the combined entity. HDFC, the country’s largest housing finance company, stopped trading on July 12, ending its 45-year-long journey on domestic stock exchanges, post the merger with its subsidiary, HDFC Bank that came into effect on July 1.

On the last day of trading, HDFC shares closed at ₹2,729.95 apiece, down 0.62% on the BSE with a market capitalisation of ₹5.05 lakh crore. All futures & contracts (F&O) contracts in HDFC expired on July 12 ahead of the merger of the mortgage lender with HDFC Bank on July 13.

On Thursday, HDFC Bank shares opened 1.3% higher at ₹1,655 against the previous closing price of ₹1,633 on the BSE. During the session, the banking heavyweight rose 1.4% to hit an intraday high of ₹1,656.8, with 3.15 lakh shares changing hands over the counter. Finally, the stock settled at ₹1,641.3, up 0.51% with a market capitalisation of lakh crore. In comparison, the BSE benchmark Sensex ended at 65,559, up 165 points, or 0.25%.  

Shares of HDFC were delisted from stock exchanges today and started trading under the HDFC Bank ticker. With a combined market capitalisation of over ₹14 lakh crore, the merged entity will become the second largest in terms of m-cap on the BSE after Reliance Industries (₹18.8 lakh crore). It would also become the world's fourth largest bank after JP Morgan Chase & Co, Industrial and Commercial Bank of China Ltd (ICBC) and Bank of America Corp. 

Last month, the boards of HDFC Twins had fixed July 13 as the ‘Record Date’ for determining the shareholders of HDFC, who would be allotted the shares of HDFC Bank. As per the merger agreement, the existing shareholders of HDFC will receive 42 shares of HDFC Bank for every 25 shares they hold. Now, HDFC Bank will be 100% owned by public shareholders and existing shareholders of HDFC will hold 41% stake in HDFC Bank.

The two listed subsidiaries of HDFC - HDFC Life Insurance Company and HDFC Asset Management Company - became subsidiaries of HDFC Bank with effect from July 1, 2023. Besides, two insurance companies - HDFC Life Insurance Company and HDFC Ergo General Insurance Company - also became subsidiaries of HDFC Bank post merger. HDFC Bank has also become co-sponsor of HDFC Mutual Fund, in place of HDFC with effect from July 1, 2023.

Following the merger of HDFC and HDFC Bank, the National Stock Exchange (NSE) announced changes to various indices, including Nifty 50 and Nifty 100. LTIMindtree, the merged entity of Larsen & Toubro Infotech (LTI) and Mindtree, has replaced HDFC from Nifty 50 index, while Jindal Steel and Power has replaced HDFC in the Nifty 100 index.

In the Nifty 500 index, HDFC has been replaced by pharma major Mankind Pharma, which recently made its debut on the stock exchanges.

Meanwhile, HDFC will be replaced by LIC Housing Finance in Nifty Financial Services, Ambuja Cements in Nifty High Beta 50, Poonawalla Fincorp in Nifty Financial Services Ex-Bank, Phoenix Mills in Nifty Housing, and Brigade Enterprises in Nifty Core Housing.

Last month, Deepak Parekh, who oversaw the HDFC-HDFC Bank merger, announced his retirement after serving India's largest mortgage lender as chairman for more than four decades.

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