Thursday, February 16, 2017

HDFC BANK: THE BIG NEWS FOR TOMORROW’S TRADE


This is going to be a short blog post. A very important trigger for the biggest stock in the Nifty and the Bank Nifty. HDFC Bank is the highest weighted stock on the Nifty and the Bank Nifty and it’s now out of the ban list for FIIs. Simply put, tomorrow morning, FIIs can buy HDFC Bank in open markets. So how crucial is this?

Well first of all, those FIIs who want to own a piece of HDFC Bank all this while could still do it. However they could only do it from their fellow FIIs in a special window and the premium on that is 12%. Even today, while HDFC Bank closed at 1327 in the normal market - http://www.bseindia.com/stock-share-price/hdfc-bank-ltd/hdfcbank/500180/ , it traded at 1482 in the FII window: http://www.bseindia.com/stock-share-price/hdfc-bank-ltd/hdfcbank6/600180/
. So that’s the premium which some FIIs are willing to pay to get the shares of HDFC Bank.

Now, I am not suggesting that the stock immediately goes up 12% tomorrow but what is interesting is that this window will last for all of 2 days, i.e 17th and 20th and by then it will be back in the ban list as there will be enough demand. So it’s literally a case of a flash sale that lasts for a few hours and you see huge demand.

By conservative estimates, I expect the stock to rally at least 5-6% tomorrow. Do the arithmetic on what it could mean for the Nifty and more importantly the Bank Nifty where it has over 30% weight.

Disclaimer: The author of this article does not invest/trade in stock markets including derivatives. His only exposure to stock markets is via the stock options given to him by his employers as part of his compensation


Posted by at

7 comments:

  1. Santosh MeenaFebruary 16, 2017 at 8:34 PM

    Grt interpretation sir ji..as always awesome

    ReplyDelete
  2. Manoj jainFebruary 16, 2017 at 9:37 PM

    love you anuj sir

    ReplyDelete
  3. RAJESH.SALADI™February 17, 2017 at 7:45 AM

    It will come to normal price before expiry

    ReplyDelete
  4. UnknownFebruary 25, 2017 at 12:58 PM

    great application of knowledge on your side

    ReplyDelete
  5. Shivi ChoudharyJune 20, 2017 at 6:18 PM

    If you are a distributor of Free Stock Cash Tips so Call me on 9644405056

    ReplyDelete
  6. hrromanMarch 27, 2020 at 2:10 PM

    Ways & Works Consulting is an ISO 9001:2015 certified HR Consulting Firm, Manpower Recruitment and Practical Training firm career with an aim to provide value aided service to employersTop Manpower Recruitement company in india . with an in-depth understanding of their requirements. We are working as a perfect bridge between the employer and employee to fulfil their needs by placing the best suitable at place.

    ReplyDelete

Subscribe to: Post Comments (Atom)