Sensex Surges Over 1,500 Points Led By HDFC Twins After Board Proposes Merger Deal

The Indian equity benchmarks surged on Monday led by gains in country's largest mortgage lender HDFC and the largest private sector lender HDFC Bank after boards of both the companies approved the merger of the two entities in a way paving the way to create the country’s most valuable company, analysts said. The Sensex rose as much as 1,568 points and Nifty 50 index reclaimed its important psychological level of 18,000. Rally in HDFC and HDFC Bank added over 1,000 points towards gain in the Sensex.

As of 10:10 am, the Sensex surged 1,545, points 60,822 and Nifty 50 index climbed 410 points to 18,080.

Board of directors of HDFC approved, subject to shareholders’ approval, its merger with HDFC Bank. Over the last 45 years has developed one of the best product offerings, delivered in a cost effective manner and in an efficient turn-around time, making it a leader in the housing finance business, HDFC said in a press release.

HDFC and HDFC Bank were top gainers in the Nifty 50 index both the shares rallied a whopping 14 per cent and 10 per cent each respectively following the merger announcement.

HDFC Life, Bajaj Finance, Hero MotoCorp, Bajaj Finserv, Larsen & Toubro, Kotak Mahindra Bank, Bharat Petroleum, UPL and Titan also rose between 0.7-7 per cent.

ONGC, Infosys, Maruti Suzuki, Cipla, Reliance Industries, Tata Consumer Products and Shree Cements were among the losers.

All the fifteen sector gauges, barring the index of IT shares, compiled by the National Stock Exchange were trading higher led by Financial Service index's 5 per cent gain. Nifty Bank and Private Bank indices also rose around 3 per cent each.

Broader markets were also witnessing buying interest as Nifty Midcap 100 index rose 1.05 per cent and Nifty Smallcap 100 index climbed 1.3 per cent.

The overall market breadth was extremely positive as 2,520 shares were advancing while 568 were declining on the BSE.