HDFC Bank has been a stalwart in the Indian banking sector. With a market cap of over ₹9 lakh crore, the private lender is already the biggest bank in India and as it merges with HDFC it will become a banking behemoth worth ₹14.7 lakh crore. For comparison, SBI, the country’s biggest public bank has a market cap of around ₹5 lakh crore.
The Investment: So, if your dad had invested ₹10,000 in HDFC Bank a decade ago on July 1, 2013, he would have bought approximately 30 shares. With the current market price at ₹1,700, that investment would now be worth approximately ₹51,000. An over 410% return on your investment.
Note: HDFC Bank went for a stock split in 2019, the prices have been adjusted to account for that.
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Background: HDFC Bank is set to merge with HDFC, a major housing finance company. The merger, considered the largest transaction in India’s corporate history, will take effect on July 1. The combined entity will have an asset base of approximately ₹18 lakh crore.
The merged entity will have around 1.2 crore customers. It will also increase its branch network to over 8,300 and have over 1,77,000 employees on the payroll.
As per Bloomberg data, the merger between HDFC Bank and Housing Development Finance Corp. will result in the formation of a financial institution that stands as the fourth largest in terms of equity market capitalisation. The top three positions are held by JPMorgan Chase & Co, Industrial and Commercial Bank of China, and Bank of America Corp.
Price Action: HDFC Bank’s share price was up 1.69% to trade at ₹1,704.50 in the late hours of trading on Friday.
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Disclaimer: Benzinga India doesn’t give financial advice. The above article is for educational purposes alone.
Editor’s Note: Artificial intelligence was used as a secondary aid in the writing of this story.
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