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US market better money-spinner for Indian cos

The US market has turned out to be better in valuation as well as returns for companies listed in both the countries.

business Updated: Dec 09, 2007 11:40 IST

The Indian stock market may be growing at a faster pace than its American counterpart, but the US market has turned out to be better in valuation as well as returns for companies listed in both the countries.

For the 11 Indian companies listed in both US and Indian equity markets, the market capitalisation gain on US bourses was more than one billion dollar higher than the same on the domestic bourses here over the past week.

Besides, the total US market value of these companies is nearly 20 billion dollar higher than their Indian valuation. There are a total of 16 Indian companies listed in the US, but only eleven of them are listed on the domestic bourses as well.

Those listed on both the markets include four IT firms -- Infosys, Wipro, Satyam Computer and Patni Computer-- two banking giants ICICI Bank and HDFC Bank, two Tata group firms Tata Motors and VSNL, state-run MTNL, pharma major Dr Reddy's Labs and Anil Aggarwal-promoted Vedanta group's Sterlite Industries.

The total market capitalisation of these 11 companies is about 135 billion dollar in the US, against about 115 billion dollar in India.
According to an analysis of their share price movements in the two markets, their cumulative market capitalisation grew by 6.5 billion dollar in US last week, against just 5.3 billion dollar here.

This is despite the Indian stock market's benchmark Sensex gaining a higher 3.1 per cent in the week, against a 1.9 per cent rise in the Dow Jones Industrial Average index, the barometer for the US market. Year-to-date also, the Sensex has gained a whopping 45 per cent, compared to DJIA's 9.3 per cent rise.

The higher return in the US market came despite all of them registering a positive return on the Indian bourses, while one of them -- VSNL -- gave a negative return in the US, with its market cap falling by 8.5 million dollar.

The market cap of Videsh Sanchar Nigam grew by 145 million dollar on the BSE during the week.

For individual companies, Satyam Computer, HDFC Bank, MTNL, Dr Reddy's Labs and Patni Computer recorded better gains in the US, while the rise in the market capitalisations of Infosys, Wipro, ICICI Bank and Sterlite were higher in India.
Infosys recorded the highest gain of 1.5 billion dollar in the US, while ICICI Bank saw the biggest increase of 1.75 billion dollar in India.

Besides these 11 companies, there are five more Indian companies listed in the US. However, these firms -- three BPO firms Genpact, WNS Holdings and EXLService Holdings and two Internet companies Rediff.Com and Sify -- are not listed in India. These five companies have a total market capitalisation of about five billion dollar.