There are a total of 303 Type A Scrips in BSE Sensex. Sensex and everything shot up the day before Brexit in the hope that Britain will remain. Let’s consider the share prices close of play 22 June, the day before referendum and compare them with today’s numbers. The maximum hit any company took in this period is HDIL at -8.8%, whether related or not is a different discussion altogether.

Range Number of Companies
-9 to -8% 2
-8 to -7% 5
-7 to -6% 5
-6 to -5% 5
-5 to -4% 6
-4 to -3% 20
-3 to -2% 22
-2 to -1% 37
-1 to 0% 81
0 to 1% 38
1 to 2% 20
2 to 3% 19
3 to 4% 17
4 to 5% 9
5 to 6% 4
6 to 7% 6
7 to 8% 2
8 to 9% 2
11 to 12% 2
19 to 20% 1

 

For details, let’s take the names of all those companies which crashed by more than 4% in this period. Well, we see some expected names like Tata Motors and Tech Mahindra, but if this is the ‘catastrophic’ impact of Brexit on Indian markets, what are we still talking about?

 

SC_CODE SC_NAME 22-Jun 28-Jun Percent
500092 CRISIL LTD 2121 2030.15 -4.28%
500408 TATA ELXSI 1783 1690.75 -5.17%
500470 TATA STEEL 332 311.45 -6.19%
500570 TATA MOTORS 472.5 440.35 -6.80%
506615 SUN ASIAN 8.44 7.81 -7.46%
517334 MOTHERSON SS 302.4 278.3 -7.97%
521070 ALOK INDS. 4.61 4.35 -5.64%
530019 JUBILANT 335.1 317.45 -5.27%
531500 RAJESH EXPO. 459.1 431.65 -5.98%
532281 HCL TECHNO 770 713.4 -7.35%
532400 KPIT 188.2 179.5 -4.62%
532540 TCS LTD. 2660.05 2461.8 -7.45%
532541 NIITTECH 522.4 489.4 -6.32%
532654 MCLEOD RUSSE 197.05 187.3 -4.95%
532710 SADBHAV ENGG 294.5 276.8 -6.01%
532755 TECH MAH 532.2 501.1 -5.84%
532809 FSL 46.15 44.15 -4.33%
532832 INDBUL REAL 93.55 87.6 -6.36%
532835 ICRA 4306 4002.4 -7.05%
532868 DLF LIMITED 140.1 133.5 -4.71%
532873 HOUSING DEV 105.7 96.4 -8.80%
533273 OBEROI REAL 279.25 267.7 -4.14%
535648 JUSTDIAL 656.35 600.05 -8.58%

 

There are two more markers – gold and oil. The prices below –

 

Commodity 22-Jun 28-Jun Percent
Gold 3005.92 3147.52 4.71%
Oil(barrel-$) 59.58 48.12 -19.23%

 

All the numbers above tell one thing – Brexit is overhyped. The impact to Indian share market is nothing. 23 out of 303(how many of them are actually because of Brexit?) is not a number worth considering. Gold which spiked up in quest for a stable currency crashed again by today. The only real impact is that of Oil and that is because British Petroleum is the sixth largest oil firm in the world.

Now the counterview. Let’s take the share movement of the largest 5 Banks on London Stock Exchange.

 FTSE Rank Company 23-Jun 28-Jun Percentage
3 HSBC 444 438 -1.35%
13 Lloyds Banking Group 70.55 54.95 -22.11%
19 Royal Bank of Scotland Group 246.6 173.8 -29.52%
20 Barclays 183.95 131.82 -28.34%
34 Standard Chartered 577.4 546.36 -5.38%

 

3 of the top 5 crashed by more than 20% – a clear indicator of who is the loser – is it the world or is it the British. HSBC and Standard Charter may have survived due to their better exposure to the global markets as compared to the other three. And, who is to forget the spectacular fall of the pound?

Synopsis – The global impact(at least, on India) for Brexit is nothing, except for oil prices which fell. But, the impact on companies operating only inside Britain looks terrible. However, a word of caution – impact inside Britain can be gauged only after a few months pass and how condescending EU will be towards Britain.

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