HDFC twins' stocks see heavy selling pressure; settle nearly 3% down

Stocks of HDFC twins on Tuesday witnessed a heavy selling pressure and settled nearly 3 per cent lower amid profit booking at higher valuations, and ended up as the top losers on both the benchmark indices.

Shares of mortgage lender HDFC ended the day at Rs 2,622.00 apiece, down 2.12 per cent over its previous close, while the HDFC Bank settled the day at Rs 1,607.15, lower by 2.98 per cent.

On Monday, shares of HDFC and HDFC Bank had witnessed heavy buying and settled with nearly 10 per cent gains as investors lapped up the announcement of their proposed merger.

At the end of Tuesday's trading session, market capitalisation of HDFC stood at Rs 4,75,375.07 crore, down from Rs 4,85,691.18 crore on Monday.

Similarly, market capitalisation of HDFC Bank slipped to Rs 8,91,251.62 crore, from Rs 9,18,591.13 crore on Monday.

Traders said the rally in HDFC twins counter on Monday was largely due to a knee jerk reaction to the announcement of the proposed merger. Accordingly, some investors resorted to profit booking at higher valuations.

In the biggest merger in corporate history, India's largest housing finance company HDFC will merge with the country's largest private lender HDFC Bank to create a banking behemoth.

Once the deal is effective, HDFC Bank will be wholly owned by public shareholders, and existing shareholders of HDFC will own 41 per cent of the bank, according to stock exchange filings by the firms.

Meanwhile, the broader market also ended in the negative territory. The 30-share BSE gauge ended 435.24 points or 0.72 per cent lower at 60,176.50. Similarly, the NSE Nifty shed 96 points or 0.53 per cent to close at 17,957.40.