Shares of HDFC Bank climbed approximately 1 per cent in early Monday trade after the lender disclosed that an independent legal review found no evidence to substantiate the concerns raised by former chairman Atanu Chakraborty.
The bank engaged two external law firms to examine board records and communications related to the allegations outlined in Chakraborty's resignation letter.
The review concluded that the claims lacked evidentiary support, a finding that has helped restore investor confidence in the lender's governance framework.
The positive reception follows weeks of uncertainty surrounding the departure of the former chairman.
By clearing the bank of the specific allegations, the legal review removes a key overhang that had weighed on sentiment among institutional investors.
Market participants will now focus on whether this resolution stabilizes the stock ahead of upcoming earnings reports and any further regulatory commentary on the bank's leadership structure.