These Three Stocks Declined For Five Straight Fiscals
Shares of UCO Bank, Indian Overseas Bank and Reliance Power have dropped 74 percent, 77 percent and 96 percent in last five years.
Only three stocks have declined for five straight financial years on account of weaker operational performances.
Shares of UCO Bank, Indian Overseas Bank and Reliance Power Ltd. have dropped 74 percent, 77 percent and 96 percent, respectively, in the last five years, according to Bloomberg data. So far this fiscal, the stocks have declined 5 percent, 23 percent and 52 percent, respectively.
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State-run UCO Bank have reported a cumulative net loss of Rs 12,272 crore during the five-year period, according to Bloomberg data. In 2018-19 alone, the lender’s loss stood at Rs 4,321.09 crore. The Kolkata-based bank suffered loss for the fourth year in a row.
Indian Overseas Bank reported a net loss of Rs 16,809 crore in the last five years. While the lender’s loss narrowed to Rs 3,738 crore in FY19 against Rs 6,300.5 crore in 2017-18, it remained in the red for nearly half a decade. The Chennai-based bank’s asset quality, however, improved. Its gross bad loans fell to 21.97 percent in 2018-19 from 25.28 percent a year ago and net non-performing assets dropped to 10.81 percent from 15.33 percent in 2017-18.
Though Reliance Power reported a cumulative profit for last five years, high interest obligations, coupled with auditor concerns, do not augur well for the company.
“It’s a case of cash-flow mismatch as the company (Reliance Power) undertook large investments at the start of the project cycle which yielded insignificant receivables,” Deven Choksey, managing director at KR Choksey Investment Managers. Thus, it led to higher debt and fall in the stock price, he told BloombergQuint over the phone.
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