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One in 10 stocks of the S&P BSE 500 hit a 52-week low on Thursday. Of 500 stocks, 67 traded at their year-low on the exchanges on a day when India's benchmark indices fell the most since September 2011.
Shares of companies such as Bank of Baroda, BHEL, Corporation Bank, DLF, GAIL India, Crompton Greaves, Hindustan Petroleum, Indian Oil, MCX, Oberoi Realty, Punj Lloyd, Ranbaxy and JP Associates, among others, touched their lowest in a year on Thursday.
The decline did not stop here. There were 14 companies of the BSE 500 which traded at all-time lows. These include Bajaj Hindusthan, Bharti InfraTel, GTL Infra, MCX, Oberoi Realty, Titagarh Wagon and Shree Renuka. (Click for table)
According to experts, the US Fed governor’s comments last night on pulling back the monetary stimulus would squeeze liquidity. They also say investors could now look at those stocks hit the hardest in on Thursday's trade.
U R Bhat, managing director of Dalton Capital Advisors (India), says: “I think our markets should stabilise below this level. It was a knee-jerk reaction globally but there is a possibility the markets may rebound soon.”
According to him, it would not be unwise to start looking at some of the hard-hit stocks. “I would not say investors should get into all these stocks. They should be selective and choose companies which have strong fundamentals. I believe, if one has a two-three year horizon from here on, a lot of money can be made on some counters,” he adds.
His views are echoed by the chief investment officer of a foreign fund house.
“If investors, especially retail, want to start investing , they should start accumulating slowly and not buy stocks at one go. Since there could be some further downside, it would make sense if one averages out their holdings from at least two year perspective." However, he cautions that all-time lows should not be a guide for investors to pour money into the market.
On Thursday, S&P BSE 500 lost 191.90 points or 2.65 per cent to close at 7,047.04.
