IndusInd Bank hit a new high today at Rs.1723.20 and Bharat Financial Inclusion is up 2% at Rs.953; it has been hitting a new high consistently for the past two trading sessions. Its 52-week high stands at Rs.955.95.

Bharat Financial Inclusion today informed the exchanges that it has entered into an Exclusivity Agreement with IndusInd Bank for agreeing to have an exclusive discussion with IndusInd Bank about the proposed potential strategic combination by way of amalgamation through a scheme of arrangement, or any other suitable structure. 

There has been a buzz around both the stocks for past couple of months of a possible merger and finally, this confirmation puts an end to all the rumours.

This will prove to be a great advantage for InduInd as it will gain ready access to rural India where Bharat Financial has made deep inroads. Analysts say that the Bank will also have the advantage of Priority Sector Loans (PSL) as it could use the excess PSL that will now come to its kitty to earn more through sale of PSL certificates.

Details of the merger are yet to be chalked out clearly and till then, we can speculate about the probable ratio and valuation.