On July 3, HDFC Bank’s share price gained over 2% after the lender proclaimed the completion of the merger with its parent HDFC Limited.

The private lender’s top boss, Sashidhar Jagdishan, has stated that HDFC Bank can now make a new bank its size every four years after the merger.

At 9:40 am, the HDFC Bank shares were trading at Rs 1,736.95 on the NSE, up 2% over the earlier close. HDFC Limited was trading 2.6% higher at Rs 2,896.50 on the NSE.

Given the mutual entity’s large and increasing distribution and customer franchise, more-than-adequate capital, strong asset quality and profitability, Jagdish believes the bank is ready to assist the under-penetrated markets.
According to analysts, this is an appropriate time to invest in HDFC Bank, which is on a speedy growth path. Foreign broking firm Morgan Stanley believes the stock is a compounder trading at striking valuations.

The bank’s present valuation is 16 times the one-year forward earnings per share (EPS), which is 20% below the 15-year average. This states that the stock trades at a comparatively lower price associated with its historical average.
With the deal getting active, HDFC Bank will be 100% owned by public shareholders, and current shareholders of HDFC will own 41%. Every HDFC shareholder will receive 42 shares of HDFC Bank for every 25 shares they hold.

The HDFC Bank’s Board of Directors, in discussion with the Board of Directors of HDFC Limited, has decided on July 13, 2023, to determine the shareholders of HDFC Limited who would be issued and allotted the shares of HDFC Bank.