Leading information technology, communications and
entertainment (ICE) companies have lost over Rs 66,000
crore in market capitalisation (M-cap) during the last
two years. Even in the recent Bull Run, which took the
Sensex above 3900 this week, these segments have been
bypassed by old economy stocks like Reliance and ONGC.
to the data released by the Centre for Monitoring Indian
Economy, IT companies such as Wipro, Infosys, HCL and
NIIT lost around Rs 30,000 crore in M-cap since 8 March
2001. The upward movements in the Sensex to 3900 was mainly
due to gains in old economy majors like ONGC with an M-cap
of over Rs 75,000 crore and Reliance with over Rs 50,000
contrast, the IT, communication and entertainment companies
eroded almost 50 per cent of their market capitalisation
from Rs 1,35,740 crore when the Sensex was at its previous
high in the first week of March 2001, to Rs 69,243 crore
in the week ended 8 August 2003 when the Bombay Stock
Exchange index touched a new high, according to the CIME
data. It added that the M-cap of most of the Ketan Parekh
stocks eroded by 80 per cent.
meltdown was reflected from the M-cap of Wipro, Infosys,
HCL, NIIT, HFCL, Sterlite Optical, Hughes Software, SSI
Ltd, Silverline Technologies and Satyam Computers.
the last 28 months Wipro's M-cap reduced by Rs 29,234
crore (57 per cent) to end last week with Rs 22,351 crore,
while Infosys lost Rs 10,268 crore (30.4 per cent) of
its value to finish at Rs 23,563 crore.
other companies that witnessed severe erosion in their
M-cap include Visualsoft Technologies, Global Tele, Digital
Globalsoft, Polaris, Pentamedia Graphics, Mascon Global,
Shyam Telecom, Rolta India, Aztec Software, Cyberspace
and Shree Rama Multitech.
M-cap of HCL eroded by 62 per cent to Rs 5,146 crore while
that of NIIT was down by 88 per cent to Rs 471 crore.
In the telecom sector, HFCL witnessed further erosion
in M-cap by 75 per cent to Rs 780 crore while Sterlite
Opticals shed 86 per cent to Rs 325 crore in 29 months.
major Zee Telefilms lost marginally by 11 per cent with
an M-cap of Rs 4,752 crore while Soundcraft Industries
shed 84 per cent to Rs 127 crore. Hughes Software shed
57.4 per cent to end last week with an M-cap of Rs 991
crore while SSI lost 89 per cent to end with Rs 129 crore.
companies like Satyam Computers, Silverline and DSQ Software
lost over Rs 700 crore during the last 29 months.