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TCS, the Biggest Loser in the Tata Group Dispute
Nov 24, 2016


Nothing's losing value faster these days than the old high denomination currency. Giving this money a run for money -pun intended - are perhaps the Tata Group companies. As a leading daily highlights, Tata companies have lost a whopping Rs 1.2 lakh crores (Rs 1.2 bn) in market cap over the last one month. Before the dispute, the Tata group companies lorded over a market cap of Rs 8.7 lakh crore which has now come down to Rs 7.5 lakh crore. And what has been the damage to retail investors? Well, a month ago retail investors held stocks worth Rs 675 bn and the same now stands at Rs 575 bn, a total loss of Rs 100 bn (Rs 10,000 crores). As today's chart highlights, TCS accounts for a lion's share of the loss, with its market cap going down by Rs 534 bn, nearly half of the total loss borne by the group.

Will we recommend group companies should the prices reach attractive levels or would we wait for the storm to pass? Well, we believe in the principle that waiting for robins to arrive usually results in the spring getting over. And therefore with the dispute not expected to cause a lasting damage to the long term fundamentals of the group companies, over reaction by investors should be capitalized upon.

Data Source:Business Standard, Capitaline

This Chart Of The Day was published in The 5 Minute WrapUp - A Tale of Two Conglomerates: The Tata Group v/s Berkshire Hathaway

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