HDFC Life plunges 7% on block deal; Standard Life cuts stake

NEW DELHI: Shares of HDFC Life plunged 7 per cent in Wednesday’s trade on reports that a total of 6.4 crore shares changed hands on the counter at Rs 486 a piece in early trade, representing 3.2 per cent of the company’s total stake.

Volume on the counter jumped 326 times the average two-week volume on BSE. The scrip fell 7.46 per cent to hit a low of Rs 480.35 on the exchange.

ET had earlier in the day reported that Standard Life was looking to sell up to 3.2 per cent in the largest life insurer by market capitalisation. It quoted a banker suggesting a range of Rs 477.80-493.40 per share for the offer for sale.

Standard Life was to sell 2.5 per cent in HDFC Life with an upsize option of additional 0.7 per cent, as per an ET report.

Standard Life Mauritius Holdings owns 23.02 per cent stake and HDFC owns 51.48 per cent in HDFC Life. Standard Life has appointed Bank of America Merrill Lynch as the broker for the sale.

Base offer size for stake sale was Rs 2,468.1 crore and upsize option is worth Rs 705.2 crore.

For the first quarter, HDFC Life had reported an increase of 11.3 per cent in net profit, helped by strong growth in its annuity and protection business. Net profit during the quarter rose to Rs 423 crore compared with Rs 380 crore in the year-ago quarter.

The shares of the company closed 0.46 per cent lower at Rs 516.70 on BSE.