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HDFC touched a fresh record high of Rs1,878 on the BSE, up 6.70% from its previous close with a market cap of Rs3.01 trillion. Photo: Pradeep Gaur/ Mint
HDFC touched a fresh record high of Rs1,878 on the BSE, up 6.70% from its previous close with a market cap of Rs3.01 trillion. Photo: Pradeep Gaur/ Mint

HDFC crosses Rs3 trillion market cap for first time

HDFC crossed Rs3 trillion market capitalisation mark for the first time after its shares soared over 6.7% on news of raising up to Rs13,000 crore

Mumbai: Shares of Housing Development Finance Corp. Ltd (HDFC) on Monday crossed Rs3 trillion market capitalisation mark for the first time after its shares soared over 6.7% on news of raising up to Rs13,000 crore through qualified institutional placement (QIP) and preference issue.

Mortgage lender touched a fresh record high of Rs1,878 on the BSE, up 6.70% from its previous close with a market cap of Rs3.01 trillion. So far this year it rose 9.8%. At 2pm, HDFC was trading at Rs1,879 on the BSE, up 6.7% from its previous close. The Sensex index was trading higher by 0.81%.

Earlier, six companies have crossed this achievement—Reliance Industries Ltd (RIL), Tata Consultancy Services Ltd (TCS), HDFC Bank Ltd, ITC Ltd, Maruti Suzuki India Ltd and Oil & Natural Gas Corp. Ltd.

Currently, RIL is India’s most valued company with a market capitalization of Rs6 trillion, followed by TCS and HDFC Bank at Rs5.28 trillion and Rs4.92 trillion, respectively.

On Saturday, a committee of directors of the mortgage lender approved selling 64.3 million shares at Rs1,726.05 apiece to the investors, according to a stock exchange filing. The housing finance company has roped in investors like KKR, GIC, Ontario Municipal Employees Retirement System (OMERS), Premji Invest and Carmignac for raising funds.

Separately, HDFC will also sell shares to institutional investors through a so-called QIP to raise up to Rs1,896 crore, it said. HDFC’s fundraising is mainly aimed at investing in a preferential share issue by HDFC Bank, which will help the mortgage lender maintain its about 21% stake in the bank.

Global brokerage firm Morgan Stanley resumed coverage on the firm with a recommendation of overweight and kept a target price of Rs2,030, up 17%.

“On Sum of the parts analysis valuation looks attractive. We see it as a good entry point to a stock that offers a comprehensive play on India’s financial Industry via best in class, fast growing business with meaningful scale, market share and top quartile profitability," said Morgan Stanley in a 9 January report.

Of the 38 brokers tracking the HDFC stock on Bloomberg, as many as 31 recommended a “buy" rating, two asked its investors to “sell" the stock and five have a “hold" rating.

The firm will announced its December quarter earnings on 29 January. According to 7 Bloomberg analysts’ estimates, it may report a net profit of Rs4,434.80 crore.

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