PSU stocks tumble up to 24 percent

New Delhi: Shares of public sector enterprises and state-owned banks tumbled up to 24 percent on Tuesday as vote counting trends showed the BJP may not have a clear majority in the Lok Sabha polls.

The Nifty PSE Indices witnessed a steep decline of 1,856.70 points, or 16.38 percent, to close at 9,475.10, with the share price of REC tumbling 24.07 percent to settle at Rs 459 apiece, PFC nosedived 21.62 percent, Container Corp of India tumbled 19.43 percent, Bharat Electronics Ltd (BEL) declined 19.21 percent.

Also, ONGC slumped 16.23 percent, Coal India declined 13.54 percent, NTPC went lower 14.52 percent, and Power Grid slipped 11.98 percent.

The Nifty PSU Bank Index also plunged 1,211.90 points, or 15.14 percent, to close at 6,794.25.

Further, share price of Union Bank tumbled 17.65 percent to end at Rs 140, Bank of Baroda slumped 15.74 percent, Punjab National Bank declined 15.15 percent, Canara Bank plunged 13.45 percent, and State Bank of India (SBI) went lower up to 13.37 percent.

In the intra-day trade, shares of SBI tumbled up to 19.17 percent to Rs 731.95 apiece on the NSE.

At the end of the session, the market valuation of SBI stood at Rs 7,00,225.05 crore. During the day, the market capitalisation of public sector lender SBI eroded by Rs 1.08 lakh crore.

The Nifty Bank Index slumped 4,051.35 points, or 7.95 percent, to finish at 46,928.60. In the intra-day trade, the Nifty Bank index went lower by 4,589.2 points, or 9.61 percent, to 46,077.85.

Further, the index recorded its biggest fall since February 2022.

Meanwhile, shares of Railtel Corp of India tumbled 14.56 percent to close at Rs 367, Rail Vikas Nigam Ltd declined 13.16 percent, and IRCTC slumped 12.27 percent on the on the bourse.

The defence PSU stocks also tumbled up to 20 percent, with the share prices of BEML slumped 20 percent to close at Rs 3,738.85, Bharat Heavy Electricals plunged 18.88 percent, Hindustan Aeronautics dropped 17.17 percent.

Meanwhile, Mazagaon Dock Shipbuilders declined 16.20 percent, Bharat Dynamics Ltd and Cochin Shipyard slipped 10 percent each on the bourse.

At the end of the session, the 50-share NSE Nifty tanked 1,379.40 points, or 5.93 percent, to close at 21,884.50.

"In the short term, PSU stocks may lose some momentum, but they should return to the limelight soon. The speed of social reforms may take a hit, depending on how the new government approaches its agenda.

"While the mood on the street is damp now, things could change equally quickly. The uncertainty might create initial apprehension, but there's potential for significant positive developments once the new government settles in and starts implementing its policies," Vikram Kasat, Head of Advisory at Prabhudas Lilladher, said.

Trends from counting of votes on Tuesday threw up disappointing results for the BJP-led NDA in the Lok Sabha elections, which appears to be losing heavily in its strongholds of Uttar Pradesh, Haryana, and Rajasthan, although it is expected to form the government with about 290 seats.

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