HDFC AMC tumbles on high volumes

HDFC Asset Management Company (HDFC AMC) fell 5.56% to Rs 2904.70 after series of bulk deals in early trade.

The media reported that promoter Standard Life Investments will sell up to 5% of its stake in HDFC AMC, through a block deal for as much as Rs 3,042 crore. Standard Life is offering a total of 1.06 crore shares in the secondary trade at a floor price of Rs 2,870 each, a discount of 6.69% to the closing price of Rs 3,075.65 on Tuesday.

As on 30 June 2021, Standard Life Investments held 21.23% in HDFC AMC.

On the BSE, 1.18 crore shares were traded on the counter compared with the average daily volume of 24 lakh shares in the past two weeks.

On the NSE, 35.87 lakh shares were traded on the counter compared with the average daily volume of 32.42 lakh shares in the past one quarter.

The stock has fallen 10.31% in four straight sessions. The stock hit a 52-week high of Rs 3,363 on 9 September 2021. It has risen 31.43% from its 52-week low of Rs 2,210 hit on 29 September 2020.

In the past one month, the stock has fallen 4.30% as against 5.57% rise in the Sensex. It has jumped 28.56% in the past one year compared with 56.03% surge in the Sensex.

On the technical front, the stock's RSI (relative strength index) stood at 17.356. The RSI oscillates between zero and 100. Traditionally, the RSI is considered overbought when above 70 and oversold when below 30.

The stock was trading below its 50-day simple moving average (SMA) placed at 3187.49 and 200-day SMA at 3141.23.

HDFC AMC posted 14.25% increase in net profit while revenue from operations grew 23.2% in Q1 FY22 over Q1 FY21.

HDFC AMC is investment manager to HDFC Mutual Fund. The company has a diversified asset class mix across equity and fixed income/others. It also has a countrywide network of branches along with a diversified distribution network comprising banks, independent financial advisors and national distributors.

Meanwhile, LIC of India acquired 0.058% stake in HDFC AMC via open market on 24 September 2021. Following the purchase, LIC's stake in HDFC AMC has increased to 5.007% from 4.949% earlier.

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