Shares of Housing Development Finance Corporation (HDFC) climbed as much as 3.17 per cent to Rs 2,471.70 apiece on the National Stock Exchange (NSE) during the early trade on Tuesday, a day after the company reported a 296 per cent rise in its standalone net profit for the quarter ended December 2019.
On the BSE, the scrip rose 3.13 per cent to Rs 2,470.85 per share so far in the intraday trade.
HDFC reported a 296 per cent rise in its standalone net profit at Rs 8,372 crore for the third quarter ended December 31, 2019, up from Rs 2,114 crore in the corresponding period year ago, aided by a value gain consequent to the merger of Gruh Finance, an associate, with Bandhan Bank.
Gruh Finance (GRUH) merged with Bandhan Bank with effect from October 17, 2019. The corporation was allotted 15,93,63,149 shares aggregating 9.90 per cent of the total issued share capital of Bandhan Bank. “In accordance with ‘Ind AS 28 – Investments in Associates and Joint Ventures’ on derecognition of the investment in Gruh, the corporation has recognised a fair value gain of Rs 9,020 crore,” HDFC said.
In terms of trade volumes, over 32.75 lakh shares were traded so far on the NSE while on BSE, over 0.94 lakh shares exchanged hands so far.
“Given the headwinds facing the real estate sector, we believe HDFC Ltd remains best placed to leverage a) reduced competition in developer financing segment as ~35% of the market is either defocusing/recalibrating strategy/reeling under capital constraints, b) superior underwriting expertise and c) balance sheet strength to emerge as a primary beneficiary of the softening interest rate cycle and the impending revival in the real estate market,” JM Financial wrote in their post result report about the company.
The brokerage has maintained a ‘BUY’ rating on the stock with a Target Price of Rs 2,710.
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