The Hindu Business Line : ICICI Bank, HDFC Bank lead ADR fall

With nervous investors continuing their heavy selling, Wall Street witnessed one of the worst meltdowns in recent memory. The Dow Jones Industrial Average plummeted 18 per cent for the week, pushing the index to five-year lows. The broad-market S&P-500 crashed 18.2 per cent – its worst week in 75 years – and the technology-heavy Nasdaq composite tumbled 15.3 per cent.

The scenario was no different in domestic bourses. The BSE Sensex plunged 15.95 per cent and the NSE’s Nifty 14.10 dropped per cent, making investors shell-shocked.

All the Indian ADRs registered their yearly lows during the week on the US bourses.

ICICI Bank was the worst affected among the ADRs. The counter tumbled by 39 per cent on fears that there could be more bad news about its exposures to troubled banks overseas. The counter, in fact, tumbled by close to 30 per cent intraday on Friday to touch its four-year low of $12.02, but recovered to close at $13.85 against the previous week close of $22.79. The statements of the bank, RBI and the Finance Minister allaying fears over the bank stability seemed to have been ignored by market participants as they continued to dump the shares.

HDFC Bank was the next major loser which crashed by 27.9 per cent to end at $62 ($86). Even the huge cut in cash reserve ratio by RBI failed to cheer the banking counters, which were witnessing one of the worst bear hammering across the globe.

Wipro was the worst affected among IT counters, as its ADR tumbled by 27 per cent, Infosys crashed 19.2 per cent, Satyam Computer by 17.5 per cent and Patni Computer declined by 16.8 per cent. Even though Infosys came out with better-than-expected financial performance for the just concluded quarter, its dollar denominated guidance (downward revision) for 2008-09 seemed to have been slightly higher-than-expected.

Sterlite Industries plunged by 24.7 per cent to end at $5.75($7.64) on the back of weak LME.

Tata Motors, which shifted the Nano project to Gujarat, ended with a loss of 17.1 per cent at $5.91 ($7.13).

Tata Communications, erstwhile VSNL, was volatile. While it tumbled to a low of 13.8 on Friday, it bounced back to end at $17.17 ($19.48), a fall of 11.86 per cent. On the other hand, the other telecom major MTNL slumped by 22 per cent at $3.07 ($3.9201).

The ADR of Dr Reddy’s Lab finished 21.3 per cent lower by $8.5 ($10.8).

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