Bandhan Bank falls 5% after Gruh Finance deal; Gruh plunges ~14%


Equity tips:-






Shares of Bandhan Bank fell ~5% on the NSE in morning trade after the company announced yesterday that it would buy Gruh Finance, a subsidiary of HDFC Ltd, in a share swap deal amounting to ~Rs20,855cr.


The amalgamation scheme is subject to approval from the Reserve Bank of India (RBI) as well as shareholders.



The announcement was made after market hours yesterday.



The share exchange ratio for the amalgamation is 568 equity shares of Bandhan Bank for every 1,000 equity shares held in Gruh Finance.



Considering Gruh Finance's closing price at Rs306 per share on Monday, its market cap works out to Rs22,411cr, whereas the deal value, as per the swap ratio, amounts to Rs20,855cr, i.e., a discount of ~7% to Gruh's CMP. As such, the deal is in Bandhan Bank's favor.



Bandhan Bank Ltd is currently trading at Rs477.15 down by Rs23.95 or 4.78% from its previous closing of Rs501.10 on the BSE. The scrip opened at Rs482 and has touched a high and low of Rs482 and Rs470.85 respectively.



GRUH Finance Ltd is currently trading at Rs264.40 down by Rs41.8 or 13.65% from its previous closing of Rs306.20 on the BSE.


Housing Development Finance Corporation Ltd is currently trading at Rs1,961.05 down by Rs9.95 or 0.5% from its previous closing of Rs1,971 on the BSE. The scrip opened at Rs2,007 and has touched a high and low of Rs2,007 and Rs1,956 respectively.

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