Half of India's top firms have destroyed shareholder wealth since FY08

For a majority of the value destroyers, borrowings now exceed their market value, putting them in a debt trap

If retail investors are still shying away from equity markets, there is a solid reason. Nearly half of India’s top companies have destroyed shareholder value since the 2008 Lehman crisis. Their market capitalisation has failed to keep pace with expansion in their balance sheets. As many as 77 of the 155 BSE-200 companies (excluding banking and financial ones) have either reported a decline in their market value since March 2008 or the rise in market capitalisation has lagged the increase in capital employed in the business. The proportion of value destroyers shoots up to 65 per ...