The current economical position in India & world wide has forced the big corporates to take necessary actions immediately in order to protect there survival and at least maintain its existence. Different modes are being adopted to encounter the problem among which we are seeing the merger being one of the fancied option , which helps to reduce the cost remarkable and provide support for both individual entity agreed to be merged.
Deepak Parekh, chairman, Housing Development Finance Corporation (HDFC) has indicated a possibility of merger of HDFC & HDFC Bank in near future. Though he has not given any time frame, the very fact that he is even considering this in itself is very big news.
HDFC is the leading home loan provider of India and hence it becoming a part of HDFC Bank seems far fetched now. But if HDFC becomes a part of HDFC Bank, then it will make HDFC Bank the largest private sector bank of India, surpassing ICICI Bank. If that is the objective, then probably we could see HDFC Bank emerging from the merged entity.
We need to see how do the stock of both HDFC & HDFC Bank react to it.