Merger Between HDFC Bank & HDFC

Published : 30 June 2023

By : Sachin Gupta

The planned completion date for the merger of HDFC Ltd and HDFC Bank is said to be on July 1st, the tentative record date is July 13th. Today marks HDFC Ltd's final day of trading on the stock exchanges. 

The market value of HDFC Ltd is Rs. 5.19 trillion, while the value of HDFC Bank Ltd is Rs. 9.47 trillion. The combined company after the merger is expected to have a value of Rs 14.7 trillion, or $177.10 billion.

The combined market capitalization of both companies will surpass that of the top four Indian private lenders, ICICI Bank Ltd, Kotak Mahindra Bank Ltd, Axis Bank Ltd, and IndusInd Bank Ltd, which in total has a market cap of Rs. 14.3 trillion. It will also surpass the combined market capitalization of all government-owned banks worth a total market cap of Rs. 9.77 trillion.

The combined company will rank globally as the 61st most valuable firm, earning a spot in the top 100 leagues.

It will become the world's fourth most valuable lender, after JP Morgan Chase (market cap $405 billion), Bank of America ($223 billion), and Industrial and Commercial Bank of China ($223 billion).

The combined HDFC entity will outperform global banking behemoths like HSBC Holdings, Bank of China, Morgan Stanley, and the Royal Bank of Canada.

Following the merger, HDFC Ltd shareholders will own 41% of HDFC Bank. The bank will keep a swap ratio of 25:42, which means that for every 25 shares of HDFC Ltd, 42 shares of HDFC Bank will be issued.