HDFC Bank shares hits new high on first trading day post completion of merger with HDFC

On the first trading day after the HDFC-HDFC Bank merger became effective on the 1st of July, HDFC Bank shares spiked to hit a new high.

With the merger coming into effect, HDFC Bank will be 100% owned by public shareholders. Existing shareholders of HDFC will own 41% of the bank. Every HDFC shareholder will get 42 shares of HDFC Bank for every 25 shares they hold.

The board of directors of HDFC Bank in consultation with the board of directors of HDFC Limited has fixed July 13, 2023, for determining the shareholders of HDFC Ltd who would be issued and allotted the shares of HDFC Bank.

Foreign brokerage Morgan Stanley believes that the HDFC bank stock is a compounder at attractive valuations.

"The merger is synergistic. HDFC Bank gets access to secured and long tenor retail mortgage product as well as a large customer base. Its product suite – plus direct access to insurance and other subs – and geographical reach are superior to those of most private banks", says the brokerage report.

HDC Bank becomes the 4th largest Banks in World

HDFC Bank is now ranked at the fourth position in terms of market cap, behind the likes of JPMorgan, Industrial and Commercial Bank of China, and Bank of America Corp, according to data compiled by Bloomberg.

Top 10 Largest bank in the world by market cap (Value in $)

1. JP Morgan Chase $416.5 B - USA
2. ICBC $228 B - China
3. Bank of America $227.7 B - USA
4. HDFC (After Merger) $171.8 B - India
5. Agricultural Bank of China $168.9 B - China
6. China Construction Bank $162.8 B - China
7. HSBC $156.6 B - UK
8. Wells Fargo $156.2 B - USA
9. Bank of China $147.3 B - China
10. Morgan Stanley $144.2 B - USA

Top 10 Banks in India by Market Cap (Value in ₹)

Let's also look at largest banks in India in terms of market capitalisation.

1. HDFC Bank (post merger) - 14,12,055.5
2. ICICI Bank Ltd - 6,53,704.04
3. State Bank of India - 5,11,201.77
4. Kotak Mahindra Bank Ltd - 3,66,967.55
5. Axis Bank Ltd - 304211.88
6. Indusind Bank Ltd - 106707.03
7. Bank of Baroda - 98436.88
8. IDBI Bank Ltd - 59482.29
9. Punjab National Bank - 56882.91
10. Canara Bank - 54750.45