The transaction involved UK-based Abrdn selling off its entire 10.2% stake, which comprised a hefty 2.18 crore shares in HDFC AMC. The price agreed upon for this substantial holding amounted to a colossal sum of Rs 3,920.1 crore (equivalent to US$ 478 million), based on the lower end of the price range.
Based on the latest available shareholding data from the exchanges, it is evident that HDFC AMC predominantly remained a promoter-owned entity, with a commanding stake of 62.77%. Within the promoter group, Abrdn Investment’s stake amounted to approximately 10.2% during the March quarter.
Image-: Outlook India
In a whirlwind of market activity, HDFC Asset Management Company (AMC) experienced an astonishing surge as shares catapulted by a staggering 8% during Tuesday’s opening trade. The reason behind this remarkable development was the exit of promoter Abrdn Investment Management, which divested its interest in the company through block deals. The offer price ranged between Rs 1,800 and Rs 1,892.45 per share, representing a discount of 4.9% from the closing price on June 19, 2023, which stood at Rs 1,892.45.
The transaction involved UK-based Abrdn selling off its entire 10.2% stake, which comprised a hefty 2.18 crore shares in HDFC AMC. The price agreed upon for this substantial holding amounted to a colossal sum of Rs 3,920.1 crore (equivalent to US$ 478 million), based on the lower end of the price range.
Based on the latest available shareholding data from the exchanges, it is evident that HDFC AMC predominantly remained a promoter-owned entity, with a commanding stake of 62.77%. Within the promoter group, Abrdn Investment’s stake amounted to approximately 10.2% during the March quarter. Conversely, among public shareholders, mutual funds held an estimated 7.23% stake, while Life Insurance Corp (LIC) maintained ownership of around 9.21%. Foreign portfolio investors (FPIs) claimed a 7.4% stake, thereby further diversifying the ownership landscape.
Interestingly, this represents the second stake sale by Abrdn in the HDFC-owned company in preparation for an impending merger. Just the previous month, the UK investor had divested its entire stake to private insurer HDFC Bank Life through open market transactions. The proceeds from this transaction have been quite lucrative for Abrdn, with the investment yielding a remarkable return of 14 times, totaling Rs 34,000 crore since 2017. Over the course of the joint venture with HDFC Life, Abrdn had initially invested Rs 2,400 crore as part of its involvement, spanning from 2000 onwards. In the fourth quarter, HDFC AMC showcased a commendable standalone net profit surge of 10% to reach Rs 376 crore, as opposed to Rs 343 crore recorded in the corresponding period of the previous year. Moreover, revenue from operations experienced a 5% increase to reach Rs 541 crore for the quarter ending in March, surpassing the previous year’s corresponding quarter figure of Rs 516 crore.
The frenetic pace of developments within the market has propelled HDFC AMC into the spotlight, as Abrdn Investment Management’s exit via block deals sparked a remarkable 8% surge in shares during Tuesday’s opening trade. The offer price, ranging from Rs 1,800 to Rs 1,892.45 per share, positioned itself at a discount of 4.9% relative to the previous day’s closing price of Rs 1,892.45 (June 19, 2023).
Abrdn, a UK-based promoter group entity, efficiently liquidated its entire 10.2% stake, representing an impressive 2.18 crore shares in HDFC AMC. This massive transaction resulted in a significant influx of Rs 3,920.1 crore (US$ 478 million) based on the lower end of the price range. As per the most recent available shareholding data, HDFC AMC boasted a majority promoter-owned status, with a formidable stake of 62.77%. Abrdn Investment, a subsidiary of the promoter group, previously held a substantial 10.2% stake during the March quarter. Conversely, public shareholders, including mutual funds with a 7.23% stake and Life Insurance Corp (LIC) with a 9.21% stake, alongside foreign portfolio investors (FPIs) with a 7.4% stake, contributed to the diversification of ownership within the company.
It is worth noting that this marks the second time Abrdn has divested its stake in HDFC AMC ahead of an impending merger. Just last month, the UK investor offloaded its entire holding to private insurer HDFC Life through open market transactions. This strategic move proved exceptionally lucrative for Abrdn, as it generated an impressive return of 14 times the initial investment, amounting to a staggering Rs 34,000 crore since 2017.
Over the years, Abrdn, formerly a partner in a joint venture with HDFC Life, had invested a significant sum of Rs 2,400 crore starting from 2000. As for HDFC AMC itself, the company experienced a remarkable 10% surge in standalone net profit during the fourth quarter, reaching Rs 376 crore compared to the previous year’s figure of Rs 343 crore. Additionally, revenue from operations witnessed a 5% increase, rising to Rs 541 crore for the quarter ending in March, surpassing the corresponding quarter’s figure of Rs 516 crore from the previous year.
