News of HDFC Life & Exide Life Deal
HDFC life Company bought 100% stake in Exide life insurance business.
These questions may come into the mind of both companies shareholders we will try to find out the best answer of these questions
Can HDFC LIfe shareholders face loss after deal with Exide lifedeal with exide life is good or bad for hdfc life shareholders
exide life deal is good or bad for exide industries
What will be the impact of this deal on Shareholders of exide life & hdfc life?
HDFC life and Exide life deal impact on shareholders of both companies:
HDFC Life Insurance Company, one of the largest life insurance companies in India has bought 100% stake in Exide Life Insurance Company. This morning hey HDFC Life Company's management has confirmed this news in Maya HDFC Life has done this deal in 6887cr. Exide Life deal value has been done at 79rs per share of Exide Industry. What will be the effect of this deal on the shareholders of HDFC Life, it remains to be seen. For because Exide Life Insurance Company, it will be considered as a good deal. Exide Life Insurance Company which comes under Exide Group. The stock of Exide Industry had closed at nearly 178rsyesterday. Somewhere in the stock market, the big traders were already anticipating this deal because the stock of Exide Industries had increased by almost 5% yesterday. Exide Industry is the leader in its segment. Exide is a trusted brand in the business of batteries. But the business of life insurance was not giving such a good profit, so the company management decided to sell this business. If seen, the sale of Exide Industries has been 3542cr in the 2021 quarter and the net profit has been 31cr. If we compare with the March quarter, there was a profit of 320cr. Accordingly, the result of June quarter has become very successful. If we talk about the balance sheet, then the net debt is not visible on the balance sheet of Exide Industries Company. With this deal of Exide Life Insurance, positive results can be seen in the balance sheet of the company and money will come to the company. The deal with HDFC Life could benefit the shareholders of Exide Industry. On the other hand, if we talk about HDFC Life, then HDFC LIfe share was closed at 758.80s. But talking about today's trading session, pressure can be seen on HDFC Life stock because the expectation of this deal was being done around 5000 cr but the final deal is done at 6687cr. There is no doubt that after buying the business of Exide Life Insurance, HDFC Life Company's business will expand and customer base will increase but the pressure on financials can be seen. After this deal, there will be an increase in debt in the balance sheet of HDFC Life Company, which is not a good thing for the shareholders of Kapant. Therefore, we can see the negative impact of this deal on the share of HDFC Life. In June 2021 Qarter of HDFC Life Company is not posted good results. HDFC Life has registered a sale of 391cr and a profit of 269cr. On the other hand, in the March 2021 quarter, HDFC Life Company had registered a profit of sale and 319cr on 583crores. Looking at year on year basis, the profit of HDFC Life has come in at 269cr in 2021 as compared to a profit of 450cr in June 2020. Accordingly, the deal that HDFC Life has made with Exide Life Insurance Company will be considered good for Exide Life Insurance Company but will increase debt in the short term for HDFC Life. HDFC Key Management is a strong management. HDFC Group has given very good returns to its shareholders. Shareholders have given multiple returns in HDFC Life too. Hence HDFC Life is Investor Friendly Share. The pressure on HDFC Life can be seen, but in the medium to long term, this deal can prove to be right for HDFC Life.
In nutshell, we can say that Exide industries shareholders may see up move in the share price but in short term HDFC life shareholders may see some profit booking.
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