The smelting of Indian stocks

Data & Analysis

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Markets have been getting smashed over the last 12-18 months, dramatic corporate tax reform notwithstanding. But because our benchmark index views are market-cap weighted, they don’t do justice to the phenomenal destruction in value across the board.

Overall, the 1,900 companies we analysed, went from a market cap of Rs 1,46,19,230 Crores ($ 2.1 Trillion) in the middle of 2018, to currently about Rs 1,37,95,850 Crores ($ 1.97 Trillion). 

Wait. That’s a 6% decline in a little over 12 months. What’s all the hand-wringing pessimism about then?

Maybe we’ve just been spoilt by secular up moves.

But then again, maybe it’s not been as benign as the market-cap weighted NSE 500 makes it look.

Here’s what “market returns” would have looked like if we weighted equally and not by market cap.

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