HDFC Bank's stock plunged 26% in the March 2026 quarter as FIIs offloaded 47.95 crore shares (₹43,000 Cr value), slashing their holding from 47.67% to 44.05%. The sell-off accelerated after former chairman Atanu Chakraborty's mid-March resignation citing ethical concerns, triggering an 8.7% single-day drop that erased $16.3 billion in market value.
Mutual funds countered by raising stakes from 26.66% to 29.54%, while SEBI probes governance claims and RBI found no material issues.
HDFC Bank 26% Crash: FIIs Sell 48 Cr Share
Chairman Resignation: Atanu Chakraborty quit March 18, flagging "incongruence" with bank practices over two years—sparking governance fears.
FII Exodus: Third straight quarter of stake cuts; 3.62% drop amid global emerging market caution.voice.
Market Reaction: Stock hit 52-week low of ₹731.55 (March 30); rebounded to ₹750+ post-RBI stability measures.
External Pressures: Geopolitical tensions, oil spikes added to sentiment drag.
Ownership Changes (Q4 FY26)
|
Investor Type |
Dec 2025 (%) |
Mar 2026 (%) |
Change |
|
FIIs |
47.67 |
44.05 |
↓3.62% |
|
Mutual Funds |
26.66 |
29.54 |
↑2.88% |
|
Shares Sold |
- |
47.95 Cr |
₹43,000 Cr value |
Fundamentals Amid Volatility
Positives:
- Strong asset quality, healthy growth, high ROE.
- Loan-deposit ratio 99%, liquidity coverage 116%.
- Post-merger synergies in cross-selling, deposits.
Headwinds:
- Governance overhang (SEBI review).
- Higher funding costs post-merger.
- CEO rollover/chairman appointment pending.
Strengths
- Mutual funds buying the dip aggressively.
- RBI confirms no governance concerns.
- Attractive valuations below historical P/E, P/ABV.
- Healthy liquidity despite high LDR.
- Merger synergies supporting long-term growth.
Risks
- Ongoing SEBI probe into board practices.
- FII selling momentum continuation.
- Interest rate sensitivity post-merger.
- Geopolitical oil impact on margins.
- Board leadership uncertainty.
FAQs
