The non-A group stocks are no longer the minnows on the equity market turf. They command almost one-fourth of market capitalisation (m-cap) of Indian bourses. |
Since the beginning of the calendar year 2005, the share of stocks traded under the B1, B, S, TS, T and Z groups in m-cap has gone up from 17 per cent to 24 per cent. |
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These stocks accounted for 14 per cent market share in January 2004. The share of the A group stocks in total market cap of India Inc was 90 per cent in 2003. |
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Moreover, as many as 321 non-A group stocks now have higher m-cap than the A group stocks. In January this year, there were 292 such stocks. The number of the non-A group stocks with a market cap over Rs 1,000 more than doubled from 36 in January to 88 now. |
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"This is a clear indication that the recent market rally is broad-based. The trend is expected to continue," said a fund manager with a foreign brokerage. |
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As many as 1,118 stocks traded under the non-A group appreciated over 100 per cent in the first eight months of the calendar year 2005. In contrast, only six of the 190 A group stocks have witnessed similar appreciation. They are Bharat Earth Movers, Crompton Greaves, Reliance Capital, Rolta, Sterlite Biotech and Titan Industries. |
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The minnows are also commanding high market valuations and trading at a price-to-earnings multiple (P/E) of almost 16 times. They were trading at a P/E of 11.58 times in January 2005 and 9.22 times in January 2004. |
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The market valuations of the A group stocks have not kept pace with the non-A group stocks as their P/E moved up from 11.77 times at the same time last year to 13.01 times in January 2005 and 14.79 times now. |
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Since the start of the year 2005, the non-A group stocks have raised value at a scorching space. The aggregate m-cap of the non-A group stocks in the first eight months increased 67 per cent compared to just 19 per cent rise in the case of the A group stocks. |
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The total wealth of the non-A group stocks holders moved up Rs 196,627 crore to Rs 490,971 crore now from Rs 294,345 crore in January 2005. |
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During the same period, the combined market value of the A group stocks appreciated Rs 281,309 crore to Rs 17,46, 550 crore now. |
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