Shares of the HDFC Twins on Tuesday saw heavy selling pressure and settled down nearly 3 percent amid profit taking at higher valuations, ending up as the biggest losers on both benchmarks.
Shares of the real estate lender HDFC ended the day at Rs 2,622.00, down 2.12 per cent from the previous close, while HDFC Bank closed the day at Rs 1,607.15, down 2.98 per cent.
On Monday, HDFC and HDFC Bank shares saw heavy buying and settled with nearly 10 percent of gains as investors took advantage of the announcement of the proposed merger.
At the end of Tuesday’s trading session, the market capitalization of HDFC was Rs 4,75,375.07 crore, down from Rs 4,85,691.18 crore on Monday.
Similarly, HDFC Bank’s market capitalization slipped to Rs 8,91,251.62 crore from Rs 9,18,591.13 crore on Monday.
Traders said the rise in the HDFC index on Monday was largely due to the sudden reaction to the announcement of the proposed merger. Accordingly, some investors have resorted to taking profits with higher valuations.
In the largest merger in the company’s history, HDFC, India’s largest housing finance company, will merge with the country’s largest private bank HDFC Bank to create a banking giant.
Once the deal becomes effective, HDFC Bank will be wholly owned by the general shareholders, and existing HDFC shareholders will own 41 percent of the bank, according to stock exchange filings by the companies.
Meanwhile, the broader market also ended in negative territory. The BSE 30-share index closed down 435.24 points, or 0.72 percent, at 60,176.50. Similarly, NSE Nifty lost 96 points, or 0.53 percent, to close at 17,957.40.
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