Share prices of Gruh Finance Ltd and Bandhan Bank fell after they announced a merger through share swap deal. On Monday, after market closing hours, Bandhan Bank in a stock exchange filing said that the board of the lender as well as Gruh Finance had approved the amalgamation of the two.

In the share swap deal, shareholders of Gruh Finance will get 568 shares of Bandhan Bank for every 1,000 shares.

HDFC, which owns a 57.8 percent stake in Gruh Finance, gets to sell its share at a premium price and experts say that it has got a good deal as Bandhan Bank made the purchase at high valuations.

Analysts say that the deal was expensive for Bandhan Bank in the short term and may only turn profitable if they continue to scale up the business. Additionally, they also pointed out that the swap ratio wasn't profitable for Gruh Finance either with its 73.30 crore paid-up capital in valuations where the swap ratio comes to Rs 20,800 crore, which is around 7 percent lower from its Monday's market capitalization of Rs 22,436 crore at closing time.

With regard to this analysis, the share price of Bandhan Bank fell as much as 6.4 percent whereas shares of Gruh Finance fell as much as 14.4 percent in the morning session.