Will 2015's biggest wealth destroyers like Larsen & Toubro see a rebound?

The uncertainty on Dalal Street in the last five months has eroded the value of investor holdings in several stocks, mainly blue chips. The total wealth destroyed, mostly by the large-caps, between August and December — when FIIs net sold shares worth Rs 25,000 crore —was about Rs 3.6 lakh crore. The Sensex declined over 7 per cent during this period.

The wealth erosion impacted retail investors, domestic and foreign money managers. Larsen & Toubro was the biggest wealth destroyer during this period for all three categories of investors — retail, FIIs and mutual funds. According to an ET analysis, other prominent wealth destroyers were Axis, ICICI and State Bank of India. Many of these stocks are unlikely to see a sharp rebound in 2016 as the RBI is unlikely cut rates in a big way — considered the biggest trigger for most of these stocks. Also, with FIIs bearish on emerging markets, these stocks are likely to remain under pressure.