There was an interesting report that was published by Crisil about Global Depository Receipts (GDRs), bank certificates issues to Indian companies to give them access to foreign investors. Their data indicated that 40 GDRs were issued by Indian companies in 2010 and investors have lost money in 85% of them. Four out of the five issues have given negative returns of 35%, which means 80% of the issues are giving negative returns of a very high magnitude of 35%. In comparison to that, the CNX 500 fell by only 7% in the same period. Thus, it is clear that huge underperformance is coming from the GDR market.
Tarun Bhatia, author of the report and director- capital markets at Crisil Research and Prithvi Haldea of Prime Database, in an interview with CNBC-TV18Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
