In the board meeting held on September 27, 2024, IDFC Ltd. announced that it received approval from National Company Law Tribunal (NCLT) for its merger with IDFC First Bank Ltd. You can check the announcement here.
As a result, IDFC Ltd.'s shares will be suspended from trading on the stock exchanges from October 10, 2024, onwards and the shares will not reflect in your holdings on Kite. As per the scheme of arrangement, shareholders of IDFC Ltd. will receive 155 shares of IDFC First Bank for every 100 shares held in IDFC Ltd.
Any fractional entitlement will be cash-settled and the amount will be credited to the primary bank account.
When will I receive shares of IDFC First Bank?
Generally, the credit of shares can take between 30 - 45 days from the record date. You’ll receive an email from CDSL once the shares are credited to the demat account.
When will the allotted shares start trading on the exchanges?
After the credit of shares, the company has to get approval from the exchanges to list the shares. Post the approvals are received the shares will start trading on the exchanges.
What will be the average price for allotted shares of IDFC First Bank?
The average price of allotted IDFC Bank shares will be calculated as follows:
Invested value in IDFC Ltd. / The number of IDFC First Bank shares received including fractional shares.
For example, if you had invested in 100 shares of IDFC Ltd. at a price of Rs. 100, the invested value would be Rs. 10,000.
If you receive 155 shares of IDFC First Bank, the average price will be Rs. 64.516 (10,000 / 155).
The fractional shares are cash settled, and the amount for these will be directly credited to your primary bank account as and when the trustee appointed by the company sells the shares.
What if I hold less than 100 shares of IDFC Ltd?
Even if you hold less than 100 shares of IDFC Ltd, you will receive an allotment of IDFC First Bank shares.
For example, if you hold 10 shares of IDFC Ltd, your allotment comes at 15.5 shares (10 x 1.55). 15 shares will be credited to your demat account. 0.55 will be fractional and the amount for this will be credited to your primary bank account.
Impact of the merger on F&O contracts
All the existing F&O contracts of expiry months October 2024, November 2024, and December 2024 will expire on October 09, 2024, and shall be physically settled.
Note:
- The IDFC contracts will undergo physical settlement and physical delivery margins will be charged for open positions as per our policy.
- The expiry date on the Marketwatch will continue to display as the old expiry date but the contract will be available for trading only till the revised expiry date.
For more details, you can check the circulars here (1, 2, & 3).