Over Rs 2.70 lakh crore has been wiped out in market capitalisation since the Budget was presented on February 29, when the Sensex touched 17,578.72. The M-cap of the Bombay Stock Exchange (BSE), which touched Rs 58,85,951 crore on February 29, 2008 is now down to Rs 56,15,813 crore on March 3, 2008. Around Rs 2,70,138 crore of shareholder wealth was eroded in Monday?s fall , when the Sensex fell 900.84 points to touch 16,677.72 .
Foreign institutional investors (FIIs) played the key role, selling heavily in A-group shares across various industries including banks, NBFC, steel, electricity, electric equipment, electronics, construction, oil&gas, fertilizers, retailing, telecommunications, trading and cigarettes.
Nilesh Shah, deputy managing director, ICICI Prudential MF, said, ?Indian markets have corrected in line with the global markets on rising concern for the credit losses and uncertainty over the burden of some losses to be shared between the banking sector as recommended in the Budget. While the long-term fundamentals of the economy are in good shape, the short term technical outlook has deteriorated because of the concern mentioned above.? Ved Prakash Chaturvedi, MD, Tata Asset Management, Ltd also said ?Today?s market fall reflects the global sentiment which has increasing concern about the recession in the US. Gradually, value is emerging in the Indian market.?
The aggregate market capitalisation of the Bombay Stock Exchange (BSE) ?A? group shares decreased by an amount of Rs 2,30,686 crore (-4.84%) on March 3, 2008, which came down from Rs 47,61,837 crore as on February 29, 2008 to Rs 45,31,151 crore as on March 3, 2008. Companies that were major losers in terms of market cap since Budget day include Suzlon Energy (Rs 4,378 crore), Reliance Capital (Rs 4,607 crore), SBI ( Rs 11,766 crore), HDFC (Rs 6,553 crore), BHEL (Rs 8,936 crore), Jindal Steel & Power 2,565 crore) and NTPC (Rs 10,554 crore).
A sector-wise analysis indicates that banks showed the highest decrease in M-Cap on March 3, 2008, declining 6.96% followed by NBFC (-6.55%), steel (-6.52 %), electric equipment (5.71 %), electricity (-5.68 %), construction (-5.23 %) and cigarettes (-4.52%).
Among banks, significant decrease in M-Cap was witnessed by Indian Bank (-9.75%) followed by PNB (-9.65%).
Among the 200 ?A? group stocks, increase in M-Cap was seen only in the case of 18 companies during the study period. Mention may be made of Colgate Palmolive, Asian Paints, Sun Pharma, Areva T&D, Cipla , Nestle India and Hindustan Unilever.
