Mumbai, Feb 7: Inspite of mixed emotions prevailing in the local market where the BSE sensex was in a constant jig, the GDR market witnessed a buoyant mood.The Skindia GDR index saw a record 55 point rise during the week to close at 835.73 points on February 5. This has been the highest weekly gain seen since December 18, which was attributed to a gradual improvement in the South East Asian markets.
The Skindia GDR index premium was quoting at 22.24 per cent during this week between January 29 and February 5 as against the average of 18 per cent in January. According to market men abroad, expansion in premiums indicate that the GDR market is anticipating that the worst of the correction is nearly over. During the same week the GDR index P/E was ruling at 17.55. Among the top gainers in the GDR market Hindalco recorded an rise of 15.87 per cent, while L&T and VSNL saw a rise of 13.16 per cent and 12.77 per cent respectively. The top losers in the market were SAIL, which recorded a fall of 7.10 per cent,Indian Hotels (5.88 per cent) and Ashok Leyland (4 per cent).
GDRs of Oriental Hotels was ruling at a huge premium of 208.66 per cent to its underlying share in the local market. Crompton Greaves and Jain Irrigation were quoting at premiums of 171.93 per cent and 107.59 per cent respectively to their undelying shares.
Among the GDRs trading at a discount Usha Beltron was ruling at a discount of 36.77 per cent while SIEL was traded at a discount of 10.32 per cent and Ashok Leyland (9.35 per cent). According to a study the Skindia GDR index has a low co-relation with the most tracked international indices of the world. Among the three indices Dow Jones, FTSE and Hang Seng, the GDR index has the highest co-relation with Hang Seng index. Though the Indian GDRs are widely traded on the London Stock Exchange, the Skindia GDR index has showed the lowest co-relation with the FTSE 100. The Concor's GDR issue has been held on hold till after the elections while the disinvestment commission has ruled against asecond VSNL GDR issue for the time being.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
