Soon HDFC Ltd will be merging with HDFC Bank as both entities are moving closer to completing all the formalities.
So far, the tentative date for the completion of the merger is July 1 with the tentative record date is July 13.
HDFC-HDFC Bank United Outgrowing Top 4 Private, 13 PSU Lenders
With the merger in place, the accumulated market capitalisation of HDFC Ltd and HDFC Bank Ltd will surpass that of the top four Indian private lenders combined – ICICI Bank Ltd, Kotak Mahindra Bank Ltd, Axis Bank Ltd, and Indusind Bank Ltd notably.
Not only that it will also exceed that of all government-owned banks put together.
30 June was the last day when HDFC Ltd traded on the bourses.
Presently, the mortgage lender has a market value of Rs 5.19 trillion, while that of HDFC Bank Ltd stands at Rs 9.47 trillion.
Once this merger is done, the combined entity is likely to flaunt a Rs 14.7-trillion or $177.10-billion tag.
On the other hand, all 13 PSU banks have a combined market valuation of Rs 9.77 trillion.
Similarly, the top four private banks including ICICI Bank, Kotak Mahindra Bank, Axis Bank, and IndusInd Bank have an accumulated worth of Rs 14.3 trillion.
Strengthening Position Across World
Besides this, the newly formed merged entity will also find a seat among the world’s top 100 leagues as the 61st most valued firm.
Consider the other well known firms like Apple now leads the group with a market cap of $3 trillion, followed by Microsoft at $2.50 trillion and Saudi Arabian Oil Co, also known as Saudi Aramco, at $2.08 trillion.
Across the world, it will become the fourth most valuable entity among the lenders.
At present, JP Morgan Chase is the world’s most valued lender with a market cap of $405 billion.
It is followed by Bank of America ($223 billion) and Industrial and Commercial Bank of China ($223 billion).
This merger will also outrun the global banking giants including names like HSBC Holdings, Bank of China, Morgan Stanley and Royal Bank of Canada.
When it comes to stake, HDFC Ltd shareholders will hold 41 percent in HDFC Bank after the merger is done.
In other words, the bank will maintain a swap ratio of 25:42.
So, for every 25 shares of HDFC Ltd, 42 shares of HDFC Bank will be given.
