New York: IT entities Satyam Computer Services and Wipro together accounted for more than half of the $6 billion losses incurred by the Indian stocks listed on the American bourses last week.
Tainted Satyam Computer, whose founder chairman B Ramalinga Raju had admitted to fudging of accounts worth thousands of crores, saw its market valuation erode by a $2.7 billion for the week ended 16 January. The scrip resumed trading on the New York Stock Exchange on January 13 after it was suspended in the wake of the accounting fraud.
The market capitalisation of another IT major Wipro, which has been debarred by the World Bank from receiving any contracts till 2011, tumbled as much as $1.5 billion during the same period.
Meanwhile, the total valuation of 16 Indian stocks listed as American Depository Receipts (ADRs) on NYSE and Nasdaq, plunged $6 billion in one week.
Trading of Satyam Computer was halted on 7 January after its ADR crashed 90% following the admission by Raju.
Another major loser was ICICI Bank. The private sector lender’s market capitalisation dropped one billion dollars. Similarly, valuation of HDFC declined by $883 million for the week ended 16 January.
Meanwhile, private sector lender market ICICI Bank’s valuation plunged by 1.03 billion dollars and HDFC Bank’s by $883 million, respectively.
However, IT bellwether Infosys shrugged off the gloom and added $705 million to its market value. The rise was primarily due to better than expected third quarter results - the company’s net profit soared 33.3 per cent to at Rs 1,641 crore for the December quarter.
The World Bank has banned Wipro for four years from getting any contracts, saying that the Bangalore-based firm had provided improper benefits to the bank’s staff.
Interestingly, in December, it was revealed that the World Bank had imposed a similar ban on Satyam Computer.
During last week, other Indian ADRs which saw significant fall in their market value include telecom major Tata Communication, copper producer Sterlite Industries, auto maker Tata Motors and another telecom firm Mahanagar Telephone Nigam.
While Tata Communication’s market-cap fell by $247 million, Sterlite Industries saw its valuation decrease by $240 million.
Further, Tata Motors and Mahanagar Telephone Nigam tumbled by $100 million and $44 million, respectively. IT company Patni Computer Services and internet firm Rediff.com too saw their valuation decline during the week.
Outsourcing firm Exlservices market valuation remained unchanged at $252.7 million.
On the other hand, apart from Infosys, BPO entities - Genpact and WNS, pharma major Dr Reddy’s Laboratories and internet firm Sify Technologies managed to add to their respective market capitalisations. These companies together gained in the range of $12 to 73 million.