Citigroup to exit HDFC, to take home over $2 billion

 Global banking major Citigroup has decided to offload its entire stake in Indian mortgage major HDFC, valued at over USD 2 billion, sources at both the financial institutions said today.

A senior official at Citigroup confirmed the American banking giant has decided to sell its entire 9.8 per cent stake in one of the best performing housing loan companies in the country as part of its ongoing capital planning efforts across the geographies.
Citigroup is likely to net over USD 2 billion (Rs 10,000 crore) at today's closing price of HDFC scrip (Rs 700.35). The mortgage lender has a market capitalisation of nearly Rs 1.25 lakh crore.

The stake will be sold in block deals, the Citi India official said, adding the sale process is yet to get off. When contacted, the spokesperson for Citi India declined to comment on the development.

A senior official at HDFC said investors have the right to exit his or her investment as and when he/she feels.

Shares of financial institutions have led the rally in the BSE's Sensex since the beginning of the current year and many a foreign institutional investor are said to be seizing upon the opportunity and selling their stakes.

This is the second stake sale by foreign funds in the mortage leader in this month alone. On February 2, Carlyle sold 1.3 per cent of its stake in HDFC for about USD 270 million (Rs 1,354 crore).

The same day Warburg Pincus sold about 17.5 million shares in lender Kotak Mahindra Bank through stock market deals to raise about USD 170 million