4.69 cr shares change hands for Rs 6,997 cr in HDFC Bank block deal

Earlier in the month, MSCI, a global indices provider, had increased the 'Foreign Inclusion Factor' (FIF) for HDFC Bank from 0.37 to 0.56, allowing for more foreign investment in the stock.

Following this share sale, HDFC Bank's stock price declined, erasing the day's gains.

The stock was trading at Rs 1,630.25 near the closing bell, down 0.51% from the previous close.

During its periodic review, MSCI partially increased the FIF for HDFC Bank, with a further increase planned for its next review in November.

Data from June revealed that foreign ownership in HDFC Bank was at 54.83%, just below the critical 55% threshold, qualifying it for the increased MSCI weighting during the August 2024 rebalancing.

This level of foreign ownership creates over 25% of 'foreign room,' a condition required by MSCI for considering the stock at its full market capitalization weight.

Some analysts predict that full inclusion in the MSCI index after the November review could attract up to $5 billion in foreign investments to HDFC Bank.

Even the partial increase from the August review is expected to bring in up to $1.8 billion (nearly Rs 15,000 crore) in foreign investments in India's largest private bank.

The final MSCI adjustment to increase the FIF to 1 is scheduled for November, dependent on HDFC Bank maintaining an FPI headroom above 20%.