GDR index falls by 3.84%

Mumbai, April 25: Political uncertainties coupled with the correction factor, as termed by technical analysts, took their toll on the global...

Mumbai, April 25: Political uncertainties coupled with the correction factor, as termed by technical analysts, took their toll on the global depository receipts (GDRs) of Indian companies listed on overseas stock exchanges.

With the undertone becoming weak amidst adverse statements by veteran politicians, the Skindia GDR index fell by 3.84 per cent from a high of 979.02 points on April 16 to a low of 941.43 points on April 23.

During the same period, 65 GDRs lost 1.53 per cent while their underlying shares nosedived by 3.87 per cent. The Skindia GDR index price earning

ratio also fell by 4.33 per cent to close at 20.39 points on April 23.

Story continues below this ad

Similarly, the Skindia GDR index premium plunged by 14.36 per cent to close at 17.88 per cent against its previous week’s close of 20.87 per cent. “Foreign investors have taken note of the downtrend in Indian markets and the infighting in the coalition government,” said a foreign fund manager.

GDRs of Oriental Hotels, Crompton Greaves and JK Corp were traded at apremium of 159.11 per cent, 81.74 per cent and 60.63 per cent respectively in comparison with their underlying stock values during the period between April 19 and 23.

The bears, however, failed to tighten their grip on textile industry stocks. Textile industry representatives continued their upward march on the GDR markets with the GDR of Indian Rayon surging by 10.09 per cent to close at $6 during the week ended April 23, while the GDR of Grasim Industries and Grasim registered gains of 8.80 per cent and 7.69 per cent to close at $6.80 and $10.50 respectively.

In the first quarter of 1998, GDRs from textile industry outperformed the Skindia GDR index gaining 4.89 per cent on an average as compared to a gain of 1.34 per cent in the index.

Story continues below this ad

A major share of this appreciation in the textile industry, GDRs were attributed to the gains made by Raymond and Indo Rama which appreciated by over 33 to 38 per cent on an average.

The GDRs of Bombay Dyeing and Arvind Mills declined by 16.67 per cent to $2.50 and16.44 per cent to $1.88, while the GDRs of Garden Silk, JCT, Sanghi Poly and SIV Industries remained unchanged during the first quarter.

The prominent feature of the week was the fall of over 3 per cent in the price of the ICICI GDR. Despite recording a sharp rise of 40 per cent in the net profits, the GDR of ICICI fell by 2.94 per cent on April 23 to close at $16.50.