Friday, January 1, 2016

Investors richer by Rs 2 lakh cr in 2015 despite weak markets

Shrugging-off weak trend in stocks, the total market valuation of firms listed on the BSE rose by Rs 2 lakh crore in 2015, mainly helped by a host of new listings at the bourses this year.

The total market valuation of all listed firms at the BSE rose by Rs 2,02,493 crore to Rs 1,00,37,734 crore in 2015. This was the fifth consecutive year of rise in investor wealth.

In 2015, the benchmark BSE Sensex fell by 1,381.88 points, or 5%, and hit a one-year low of 24,833.54 on September 8, after gaining nearly 30% in the previous year.

With this, the index recorded its first annual fall since 2011. The index had last recorded a yearly loss in 2011 when it fell by 24%.

The 30-share gauge ended the last trading session of the year at 26,117.54, registering a gain of 157.51 points or 0.61%.

The NSE Nifty has dropped by 336.35 points, or 4.06% -- also its first one-year drop since 2011.

"2015 has been extremely eventful for the stock market. The markets hit an all-time high with the Sensex and the Nifty surpassing the 30,000 and 9,000 levels despite several odds such as deficient monsoon, shaky global markets and subdued corporate earnings," said Kamlesh Rao, CEO, Kotak Securities.

Experts said that the rise in investor wealth was also on account of the continued rise in the number of listed firms.

Ending the IPO drought, 21 companies entered Dalal Street in 2015 with initial public offers to garner Rs 13,600 crore -- the highest in five years.

The year saw as many as 60% of the newly-listed stocks trading at a high premium over their issue prices, as against most of the stocks trending below issue price in previous years.

The star performers this year include InterGlobe Aviation which runs the country's largest airline IndiGo, Coffee Day Enterprises that owns the largest coffee chain Cafe Coffee Day, Alkem Laboratories and Inox Wind.

"2015 turned out to be a complicated year for investors with corporate performance failing market expectation. The reality surprised the exuberant expectations of rebound in earnings from a pro-reform government voted to power in 2014 and windfall from crashing crude oil prices.

"However, the momentum started to fade after announcement of the Budget, actual earnings trajectory turned out to be flat or negative," said Krishna Kumar Karwa, MD, Emkay Global Financial Service.

"As a result, the benchmark indices corrected 13-15% from their peaks in 2015 as FII flows turned negative and as concerns on global liquidity emerged in the run-up to the eventual fed rate lift-off," he added.

In the stock market, TCS continued to remain the most valued firm as its market valuation stood at Rs 4,80,626.78 crore. TCS is followed by RIL, HDFC Bank, ITC and Infosys in the top five companies list.

The net FPI inflows this year slackened to just about USD 3 billion.

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