Shares of HDFC and HDFC Bank surge 10% after the merger news

 Shares of HDFC and HDFC Bank surge 10% after the merger news

Shares of mortgage provider HDFC increased 10% today to Rs 2696 from yesterday's BSE close of Rs 2450.95.

Following the organisations' announcement of a merger plan today, shares of HDFC Bank and HDFC Bank soared 10% each in early trade. In comparison to its previous closing BSE amount of Rs. 1506.30, HDFC Bank's share price increased 9.99% to Rs. 1656.90. Similar to this, shares of mortgage lender HDFC increased 10% today to Rs 2696 from their previous close on the BSE of Rs 2450.95.

The equity share(s) held by HDFC Limited in HDFC Bank will be eliminated in accordance with the Scheme, and shareholders of HDFC Company as of the record date would receive 42 shares of HDFC Bank (each having a face value of Rs. 1) in exchange for the 25 shares they now hold of HDFC Limited (each having a face value of Rs. 2). As a result, existing shareholders of HDFC Limited will control 41% of HDFC Bank when the Scheme goes into force, and public shareholders would own 100% of HDFC Bank, according to the businesses.

Despite excellent fundamentals and stable financial outcomes since the epidemic, HDFC group stocks haven't increased much, making them all the more alluring, according to Pavitraa Shetty, co-founder and trainer at Tips2Trades. A high re-rating and emphasis on internet banking suggest that the combination will result in beneficial synergies and further consolidate leading positions in many market areas, including home loans and credit cards. This bodes well for the HDFC stock, which should soon start trending upward. Technically, if the market closes today above Rs. 1,600, it might eventually reach Rs. 1,720. For greater profits, investors are advised to purchase at prices closer to Rs. 1,480–1,500.