HDFC gains on plans to buy out arm Credila Financial

HDFC rose 0.53% to Rs 2322.85 after the company said it plans to acquire an additional 9.12% stake in its subsidiary, Credila Financial Services.

HDFC, post market hours yesterday, announced that it is proposing to acquire 1.14 crore shares, or 9.12% stake, of its subsidiary Credila Financial Services from its promoters, Ajay Bohora and Anil Bohora, for amount not exceeding Rs 395 crore.

Currently, the corporation holds 90.88% stake in Credila. Post acquisition, Credila Financial Services will become wholly owned subsidiary of HDFC.

Credila is a non-banking financial company and is in the business of providing loans for higher education.

HDFC's consolidated net profit surged 80.4% to Rs 10,388.61 crore on 27.4% rise in total income to Rs 34,051.89 crore in Q2 September 2019 over Q2 September 2018.

HDFC is engaged in financing by way of loans for the purchase or construction of residential houses, commercial real estate and certain other purposes in India.

On the technical front, the stock's RSI (relative strength index) stood at 63.08. The RSI oscillates between zero and 100. Traditionally the RSI is considered overbought when above 70 and oversold when below 30.

The stock was currently trading above its 50-day moving average (DMA) placed at Rs 2162.55 and its 200 DMA placed at Rs 2094.33.

Source : Business Standard