Here’s What The Rout Has Done To Valuation Of Nifty 50 Stocks

The Nifty 50 index has tumbled by more than a fourth in March, tracking the global selloff as the trade disruption by Covid-19 pandemic caused panic selling worldwide.

It’s already the most volatile year for Indian equities since 2011, taking the benchmarks below the levels last seen after demonetisation. That plunge has brought valuations of nearly three-fourths of Nifty 50 stocks below their 10-year average.

Of the 41 non-financial stocks, 32 are cheaper than their long-term historical average. Broadcaster Zee Entertainment Enterprises Ltd. and tower firm Bharti Infratel Ltd. trade at the biggest discount.

Here’s the list:

Zee Entertainment

Weak business outlook amid the economic slowdown, pending receivables from group companies, news flows related to the investigation conducted by the government and the telecom regulator’s proposed tariffs have weighed on its valuations.

Bharti Infratel

The concerns regarding the survival of Vodafone Idea Ltd., which contributes a third of its tenancy income, after the Supreme Court denied relief in payment of statutory dues has impacted valuations.

ONGC

A plunge in crude and an expected fall in gas prices have weighed on the valuations of India’s largest oil and gas explorer. Prices of both the commodities are currently below its cost of production.

GAIL

Valuations have dropped as low prices of crude oil and gas are expected to impact the earnings of three key segments – petrochemical, LPG and marketing.

Coal India

Sluggish production, lower e-auction realisations and stake sell by promoters have weighed on the valuations.

Six of the nine financials trade at lower earnings multiple compared to the 10-year average. The Yes Bank Ltd.’s fiasco and fears of rise an increase in bad loans has brought down the valuations of this cohort of stocks.