SBI MF buys over 2% stake in HDFC AMC; stock jumps 5%
Shares of HDFC Asset Management Company (AMC) rallied nearly 5% in intraday trade on Tuesday after SBI Mutual Fund acquired 2.2% equity stake in the HDFC Group firm for ₹757 crore through an open market transaction. SBI Mutual Fund on Monday purchased 47.33 lakh shares of HDFC AMC at an average price of ₹1,600 apiece, taking the aggregate value at ₹757.40 crore, as per the bulk deal data available on the National Stock Exchange (NSE).
Extending gains for the second day, HDFC AMC share price opened higher at ₹1,697.95 against the previous closing price of ₹1,683 on the BSE. During the session, the largecap stock surged as much as 5% to hit an intraday high of ₹1,768.45, before settling at ₹1,764.80, up 4.86%. On the volume front, 0.81 lakh shares changed hands over the counter on the BSE as compared to the two-week average volume of 0.37 lakh stocks. The market capitalisation climbed to ₹37,658 crore.
HDFC AMC shares currently trade 29% lower than its 52-week high of ₹2,479.25 touched on April 4, 2022. The stock has given a negative return of 18% to its shareholder in the last one year, while it has fallen 8% in six-month period. On the year-to-date (YTD) basis, the counter has nosedived 19.5%, while it shed 4% in a month.
HDFC AMC hit a 52-week low of ₹1,595.25 in intraday trade on Monday after the U.S.-based GQG Partners, which recently invested in the Adani group, sold partial stake in the asset management company via open market transactions. Rajiv Jain-led American equity investment boutique sold about 24.7 lakh shares, or 1.16% equity, in the company for around ₹397 crore. The deal was executed at an average weighted price of ₹1,600.85 per equity share, according to bulk deal data.
At the end of December quarter of the current fiscal (Q3 FY23), GQG Partners owned 2.28% stake in HDFC AMC. While promoters and promoter group entities held 62.78% stake in the company, public shareholders owned 37.22% shareholding in the company. Among promoters, HDFC owns 52.57% stake and abrdn Investment Management holds 16.2% shares. Among the public shareholders, mutual funds own 3.07%, foreign investors hold a combined 12.09%.
In a separate development, the National Company Law Tribunal (NCLT), Mumbai Bench, on Monday gave nod to the merger of Housing Development Finance Corp (HDFC) and HDFC Bank, which is touted to be the biggest merger in the history of corporate India. The merger deal has already been approved by the domestic stock exchanges, BSE and NSE, Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), the Pension Fund Regulatory and Development Authority (PFRDA), and Competition Commission of India (CCI). It had also received no objection certificates from both the stock exchanges.
HDFC, the country's largest private housing finance company, will merge with the country’s largest private lender HDFC Bank to create a banking behemoth. The merger is expected to be completed by the second quarter of FY24. The amalgamation of HDFC (₹4.73 lakh crore) into HDFC Bank (₹8.81 lakh crore) will create the second-largest entity in India in terms of market capitalisation (₹13.54 lakh crore), after Reliance Industries (₹15.36 lakh crore) and Tata Consultancy Services (₹11.36 lakh crore). The merged entity will also become more than twice the size of ICICI Bank (₹5.95 lakh crore) as of March 21, 2023.