The meltdown in the market and bearish trading sentiments have taken a toll on private equity investments in the listed firms as these deals have suffered loss to the tune of a whopping $1.27 billion so far this year, says a report.
An analysis of private investment in public equity (PIPE) in 2008 shows that these deals in the country have suffered a loss of $1.27 billion so far this year.
"The overall till-date-return on PIPE deals of 2007 on volume basis is down 24.07 per cent aggregating to a loss of $1.27 billion on absolute basis," according to the latest report of Nexgen Capitals, the merchant-banking arm of brokerage firm SMC Global Securities.
In 2007, the total investment in PIPE deals were to the tune of $5.29 billion, while the current mark-to-market value of these deals now stands at $4.02 billion.
Wealth creation was highly imbalanced in different sectors. While media and real estate witnessed a major erosion in value, only telecom space braved the downtrend and managed to post decent returns.
"Only telecom with Bharti stood out the volatile capital market conditions. The investments made in media and real estate sectors have lost about two-thirds of their value," the report added.
An analysis of the various sectors shows that media suffered the maximum loss (66.25 per cent) followed by real estate (64.12 per cent), and infrastructure and IT & ITeS reported a loss of 56.65 per cent and 55.18 per cent, respectively.