HDFC Bank HDFC merger: Driven by foreign institutional investors (FIIs) and domestic institutional investors (DIIs) inflows, steady corporate earnings, Indian stock market witnessed participatory rally after ushering in new financial year 2023-24. In this rally, Bank Nifty was the first among the three key benchmark indices that hit all-time high. Later on, BSE Sensex breached its previous high of 63,585 and hit a new high of 63,601. But, NSE Nifty missed to breach its 18,887 peak on four occasions. On Tuesday also, the 50-stock index retraced from higher levels and came under the sell off stress. However, HDFC Bank HDFC merger news boosted the morale of stock market bulls and triggered fresh buying interest on Dalal Street helping key benchmark in dices to open with upside gap on Wednesday.
According to Indian stock market experts, HDFC Bank and HDFC Ltd shares contribute near 25 per cent strength of Nifty 50 index. Apart from this, HDFC Life is another share that has become volatile after the newsbreak of HDFC Bank HDFC merger news. On Wednesday, HDFC Ban k and HDFC Ltd share price ascended to the tune of 2.25 per cent whereas HDFC Life share price appreciated more than 4.50 per cent. So, this played a big role in boosting fresh rally on Dalal Street leading to Nifty breaching 18,887 and hitting 19,000 mark.
HDFC Bank HDFC merger connect with Nifty rally
Giving credit to HDFC Bank HDFC merger in Nifty hitting life-time high, Aamar Deo Singh, Head Advisory at Angel One said, “HDFC and HDFC Bank led the rise in the Nifty, which reached an all-time high in Wednesday trading session, ahead of their July 1 merger, which will create a financial giant. In the coming years, the financial industry will play a critical part in India’s growth story, with HDFC Bank at the vanguard.”
On how HDFC Bank HDFC merger boosted Indian stock market indices to hit all-time high on Wednesday, Vaibhav Vidwani, Designation Research Analyst at Bonanza Portfolio said, “HDFC Bank contributes 18.56 per cent and HDFC contribute 7.25 per cent in Nifty, together they contribute 25.81 per cent in Nifty. HDFC Bank on 4th April 2022 agreed to take over the biggest domestic mortgage lender in a deal valued at about $40 billion, creating a financial services titan. The merger is unprecedented in India, creating a bank worth $168 billion and impacting over tens of millions of customers and shareholders across the two companies apart from group insurance and asset management businesses.” He said that the proposed entity will have a combined asset base of around ₹18 lakh crores.
Highlighting the importance of HDFC Bank HDFC merger for Indian stock market, Sugandha Sachdeva, Executive Director & Chief Strategist at Acme Investment Advisors said, “HDFC Bank HDFC merger is seen as a positive development for the Indian stock market. The combined entity will be one of the largest financial services companies in India, with a market capitalization of around Rs.14.37 lakh crore. The single merged entity which could become the second-most valued Indian company is expected to receive more participation from foreign investors. This merger is expected to create significant synergies and boost the profitability of the combined entity.”
On how HDFC Bank HDFC merger news triggered fresh rally at Indian stock market, Vaibhav Vidwani of Bonanza portfolio said, “With HDFC Bank HDFC merger, the bank platform will be able to provide a diversified low-cost funding base, especially through its current and savings accounts (CASA) base. Hence, the bank will be able to offer more competitive housing products, It would further enable it to underwrite large-ticket loans and it will also provide more effective and bigger network these factors helped HDFC and HDFC bank price growth and led Nifty at higher level.”