In 100 days of Modi Govt. 2.0, Rs. 12.5 lakh crore of Investors' wealth wiped out
Investors' wealth worth Rs. 12.5 lakh crore has been wiped out in the first 100 days since the second term of Prime Minister Narendra Modi's government started on May 30. At yesterday's closing, the market capitalisation or market value of companies listed on BSE stood Rs. 1,41,15,316.39 crore as against market capitalisation of Rs. 1,53,62,936.40 crore a day before PM Modi's government came to power.
The Sensex has slumped 5.96 per cent or 2,357 points and the NSE Nifty 50 index has dropped 7.23 per cent or 858 points since May 30. Slowing economic growth, along with outflow of foreign funds and weak corporate earnings, are some of the reasons for the slump in equity markets, say analysts.
Foreign investors have been net sellers in the Indian markets. The pressure to sell increased after Finance Minister Nirmala Sitharaman introduced the super-rich tax on foreign investors in the first Budget of second NDA government, which was rolled back a month later.
Since the formation of government, foreign portfolio investors have sold shares worth Rs. 28,260.50 crore, data compiled by National Securities Depository Limited (NSDL) showed.
"The slowdown in the markets started way before the Prime Minister Modi's second term in power. The introduction of long term capital gains tax and dividend distribution tax in February 2018 budget led to the start of fall in equity market valuations and the slump in markets accelerated in the aftermath of the IL&FS crisis," AK Prabhakar, head of research at IDBI Capital, told NDTV.
"A lot of mid- and small-cap companies have corrected big and are at reasonable valuations. IL&FS crisis had a cascading effect on markets and the things are likely to recover from here on," added Mr Prabhakar.
All sector gauges compiled by National Stock Exchange except the Nifty Information Technology index have given negative returns over the last 100 days, with Nifty PSU Bank index dropping 26 per cent. Last month, the government announced mega mergers of state-run banks in which number of government-owned banks will be reduced to 12.
Metal index dropped 20 per cent in the wake of increased trade frictions between US and China. Analysts say despite the anti-dumping duty, China is selling cheap steel which is hurting the domestic metal companies.
Nifty Auto index has slumped 13.48 per cent as auto industry faces its worst slowdown in two decades. "We saw massive rise in autos in the last five years so the slowdown is also visible now. We never saw runaway sales in four wheelers. The way Maruti Suzuki has grown in the last 5 years has been amazing," Mr Prabhakar said.
courtesy: ndtv.com
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Never entered into pact to operate airport in Kenya: Adani group
New Delhi, Nov 23: Billionaire Gautam Adani's group on Saturday clarified on reports of Kenya cancelling more than USD 2.5 billion in deals after US indictment on bribery charges, saying it had not entered into any binding agreement to operate Kenya's main airport.
On the pact it had signed last month to build and operate key electricity transmission lines in Kenya for 30 years, the group said the project did not fall within the ambit of Sebi's disclosure regulations, thereby not warranting any disclosure on its cancellation.
The group was responding to notices sent by stock exchanges to confirm reports of Kenyan President William Ruto ordering the cancellation of a procurement process that had been expected to award control of the country's main airport after the conglomerate's founder was indicted in the United States.
Adani Enterprises Ltd, the flagship firm of billionaire Gautam Adani's group which houses its airport business, in a filing said it had in August this year incorporated a step-down subsidiary in Kenya to upgrade, modernise, and manage airports.
"While the company was in discussion with the relevant authority for the said project, till date neither the company nor its subsidiaries (i) have been awarded any airport project in Kenya, or (ii) entered into any binding or definitive agreement in connection with any airport in Kenya," the firm said.
It did not confirm or deny reports of Kenya cancelling the airport deal.
Adani Energy Solutions Ltd, the firm that operates power transmission lines, in a separate filing said on October 9 it was awarded the project to construct transmission lines in Kenya. Thereafter, it had incorporated a step-down subsidiary in Kenya.
"We submit that the project does not fall within the ambit of item 4 of Para B, Part A, Schedule III of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (Sebi Listing Regulations) which requires intimation to be made for any awarding, bagging/ receiving, amendment or termination of awarded/bagged orders/contracts other than in the ordinary course of business," it said refusing to confirm or deny the cancellation.
It went on to state that the award of the project was in the ordinary course of business of the company and its subsidiaries as they are engaged in the business of transmission and distribution of energy (among other things).
"Consequently, any cancellation of such Project will also not fall within the ambit of item 4 of Para B, Part A, Schedule III of the Sebi Listing Regulations," it added.
Under the proposed airport deal worth nearly USD 2 billion, the conglomerate was to add a second runway at Jomo Kenyatta International Airport and upgrade the passenger terminal. It was also to operate it on a 30-year lease.
Kenya's President in his state of the nation address on Thursday also stated that he was cancelling a separate 30-year, USD 736-million public-private partnership that an Adani Group firm signed with the Ministry of Energy and Petroleum last month to construct power transmission lines.
That followed US authorities indicting group Founder and Chairman Gautam Adani and seven others for allegedly agreeing to pay USD 265 million to Indian officials to win lucrative solar power supply contracts.
The Adani Group denied the allegations as baseless and said it would seek "all possible legal recourse".
The tender to operate Kenya's main airport was put on hold following local protests.
Adani Energy Solutions Ltd had last month signed a project agreement with the Kenya Electricity Transmission Company Ltd (Ketraco) for developing three transmission lines and two substations.
