Lehman M-cap loss exceeds that of all Indian banks

The plunge in Lehman’s share price over the past year has come along a bear-run across all the equity markets, especially for the financial sector stocks, including in India. However, the fall witnessed by Indian banking stocks seems to be much smaller when compared with that of Lehman.

In comparison to Lehman’s USD 44.2-billion loss in the past one year, the cumulative market value of all the listed banks in India has dropped by just about USD 30 billion.

In percentage terms also, Lehman’s shares have plummeted by 99.5 per cent from USD 64.5 in mid-September to a current level of just USD 0.3. During the same period, the BSE Bankex, which tracks share prices of Indian banks such as ICICI Bank, SBI and HDFC Bank, has lost about 20 per cent.

While Lehman Brothers’ market cap has dropped from USD 44.4 billion to just USD 206 million during this period, that of all Indian banks together has dropped from about USD 102 billion (Rs 4.12 trillion) to about USD 72 billion (Rs 3.3 trillion currently).

Even when comparing with the entire Indian equity market, the loss for Lehman alone accounts for nearly one-seventh of the fall in market value of all the listed companies in India.

The Indian market has lost close to USD 300 billion in past one year – dipping from about USD 1.2 trillion to about USD 900 billion currently.