IDFC First Bank Limited

Generally speaking, the arbitrage is a good idea if three conditions are met.

First, you own shares of IDFC First.
Second, you have a large capital gains tax credit sitting in your account.
Third, you have a low cost broker to execute the trades

If you have all this, then as on today, you can probably lock in a gain of about 17%, on your existing position of IDFC First.

Ofcourse there are risks.
For instance, the merger may not go through. Or the ratio may change etc.

Work through the numbers, and the difference scenarios and see what works for you.

Discl: Interested.