HDFC Bank dethrones Reliance Industries as new Baahubali of Nifty

economictimes.indiatimes.com:

HDFC twins making HDFC Bank stock much more muscular, India's largest private sector lender will now command more weightage in Nifty than billionaire Mukesh Ambani's Reliance Industries (RIL). With effect from July 13, when HDFC shares stop trading on stock exchanges following a reverse merger with its banking unit, the weightage of HDFC Bank will increase to 14.43%.

At present, RIL controls 10.9% of Nifty which will get reduced to 10.8%. The changes will make HDFC Bank command the highest weightage in the index and give it more fire power to dictate the direction of India's heartbeat index.

In case of Nifty Bank index, HDFC Bank's weight will increase from 26.9% to 29.1%, leading to inflows of about $70 million from passive funds, according to calculations by Nuvama.ICICI Bank will see its weight reducing from 24.4% to 23.3%. India's two largest private sector lenders ICICI Bank and HDFC Bank will together command 52.4% of weightage in Nifty Bank.SBI, Kotak Mahindra Bank and Axis Bank would also suffer weight reduction in the banking index.

In case of Nifty50 the weightage of ICICI Bank, Infosys, ITC and TCS would also be reduced. India's sixth largest IT company LTIMindtree will take HDFC's seat in Nifty.HDFC Bank vs RIL At a market capitalisation of around Rs 18.5 lakh crore on Monday's closing price, RIL is India's largest company by market capitalisation while HDFC Bank is at No.3 slot with a market value of Rs 9.26 lakh crore.

Following the merger, HDFC Bank's market cap would also increase as HDFC shareholders would get 42 fully paid-up shares of HDFC Bank for every 25 held in HDFC. Unlike RIL, HDFC Bank doesn't have a promoter and therefore the free float of the banking giant will turn out to be the highest