NAVs of global equity funds for India dip by 63%

The international equity funds for India have seen a decline of 63 per cent in their net assets value (NAV) in the last one year, according to the NAV data collected from Bloomberg.

Currently, 131 international equity funds for India, which are listed on the Luxembourg exchange, have witnessed a 62.8 per cent decline in its NAV at $22,79 billion compared to a year ago level of $61.20 billion.

These funds are based in Luxembourg, Mauritius, South Korea, Japan and USA and are mobilising resources from the overseas investors to invest in equity markets of major countries.

The India funds, which operate from Japan, top the value erosion chart with an average decline of 69 per cent decline in NAV, followed by USA (63 per cent), Luxembourg and Mauritius (62 per cent each), Australia and Singapore (61 per cent each), and South Korea (54 per cent).

These international equity funds, which were formed with the sole objective of investing in emerging equity markets, have been affected adversely due to the US sub-prime crisis. Of these, as many as 27 funds in Luxembourg, 21 in Mauritius, 17 in South Korea, 15 in Japan and 5 funds are listed in the US.

Bloomberg data shows that the NAV of 131 funds have depreciated in the range of 20-80 per cent over a year. About 15 funds have posted negative returns of more then 70 per cent, 104 funds between 50 per cent to 70 per cent and remaining 12 funds between 20 per cent to 50 per cent.

Apart from India, the scenario for the rest of Asia also remained negative, as the benchmark indices in the rest of Asia also turned negative. Of the total 1,089 funds, which invests in the different securities of Asian countries such as Japan, China, Hong Kong, Taiwan, Indonesia, South Korea and Australia, 993 funds have posted negative returns. Some of the returns for the funds fell more than 90 per cent.

Japan holds the supreme position among Asian countries in terms of the international investment, total 721 funds has been operated that holds total assets of $137.05 billion which is more than 50 per cent of total assets holding in Asian countries.