• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Virendra Verma

MUMBAI, Sept. 16

THE uncertainty revolving around the fate of the disinvestment process has shrunk the market value of PSU stocks by close to Rs 14,000 crore in the last two weeks.

The market capitalisation of the BL PSU index stocks has fallen from Rs 1,39,549.51 crore, as on August 30, to Rs 1,25,572.29 crore.

The BL PSU Index fell from 1,072.2 to 964.81, down 10 per cent. Over the same period, the BSE PSU Index fell from 1,589.32 to 1,423.95, down 8.29 per cent.

Also, during the period, mutual funds (excluding UTI) are believed to have lost close to Rs 200 crore or 20 per cent of their holding in PSU stocks. This is based on the assumption that none of the mutual fund holdings in PSU stocks would have been sold during this period.

The assumed fall in this market value is more than that of the PSU indices mainly due to the funds' high exposure in key PSU stocks such as HPCL, BPCL and Nalco.

However, brokers said that a number of mutual funds did sell large quantities of PSU stocks in the last 7 to 10 days, thus minimising their loss during the period. The key PSU stocks that had led to sharp fall in the market capitalisation include BPCL, HPCL, Nalco, Neyvelli Lignite, Bharat Electronic, and MTNL.

However, there has not been any major change in the market capitalisation of ONGC, the country's most valuable company in terms of market capitalisation.

The share price of BPCL has fallen 26.64 per cent from Rs 274.75 to Rs 201.55 on the BSE between August 30 and today. The HPCL share declined 27.92 per cent, from Rs 273.75 to Rs 197.30. Nalco is down 21.55 per cent, from Rs 114.50 to Rs 90.05. Today also, most of the PSU stocks fell on account of uncertainty over the disinvestment process. Among the major losers was Shipping Corporation of India, down 14.93 per cent at Rs 72.65 on the BSE.

Brokers said the fall was mainly on rumours that the Government had asked for revised bids for its disinvestment as well as rumours that the Disinvestment Minister, Mr Arun Shourie, had resigned, which later turned out to be untrue.

Send this article to Friends by E-Mail

Stories in this Section
Insider trading in Brooke Bond merger case — Court summons to HLL, directors

Copyright © 2002, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line