Lok Sabha Question No. 26 (UNSTARRED), answered on 2024-07-22
Subject: Unprecedented Fall of Stock Prices
Ministry: FINANCE
Asked by: Dr. T Sumathy Alias Thamizhachi Thangapandian, Shri S Venkatesan, Shri Anand Bhadauria, Shri Vijayakumar Alias Vijay Vasanth, Shri V K Sreekandan

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO. 26

## ANSWERED ON JULY 22, 2024/ 31 ASHADHA, 1946 (SAKA)

## UNPRECEDENTED FALL OF STOCK PRICES

## 26. Dr. T Sumathy Alias Thamizhachi Thangapandian:

Shri S Venkatesan:

Shri Anand Bhadauria:

Shri Vijayakumar Alias Vijay Vasanth:

Shri V K Sreekandan:

Will the Minister of FINANCE be pleased to state:

- a) whether it is a fact that there is an unprecedented fall of stock prices and points amounting to a loss of Rs. 30 lakh crores to investors immediately after the general elections-2024 results and if so, the details thereof;
- b) the  measures  taken  by  the  Union  Government  to  investigate  the  scam  behind  the unprecedented fall of stock prices and points amounting to a loss of Rs. 30 lakh crores to investors;
- c) the details of the investigations done so far and the current status of funds invested by various arms of Government like SBI, LIC and other Public Sector Banks in the share market;
- d) whether it is also true that the stock market went up unprecedentedly on the basis of specific investment advice to the 5 crore family investing in the stock markets, if so, the details thereof;
- e) whether  it  is  a  fact  there  was  a  demand  to  investigate  the  matter  by  the  Securities  and Exchange Board of India, if so, the details thereof along with the steps taken in this regard;
- f) whether the Government is considering the demand for JPC probe or SEBI investigation on 'engineered' volatility resulting in heavy losses for investors, if so, the details thereof;
- g) whether the Government is having any assessment on its fall out on retail investors, if so, the details thereof; and
- h) the details of 100 largest sellers on 3rd June, 2024 on NSE and stock exchanges along with amount involved therein?

## ANSWER MINISTER OF STATE FOR FINANCE (SHRI PANKAJ CHAUDHARY)

(a) to (h): Stock market movements are a function of investor perceptions along with other factors which may include, inter-alia , global economic scenarios affecting foreign capital flows, domestic macro-economic parameters and overall corporate performance.

The  stock  market  benchmark  indices,  Sensex  and  Nifty-50,  showed  an  upward  trend  since  the announcement  of  the  general  elections  on  16 th March,  2024  and  increased  by  5.3%  and  5.6% respectively till 3 rd June, 2024. On 4 th June 2024, the date of announcement of results of the general elections, Sensex and NIFTY-50 decreased by 5.7% and 5.9% respectively. The indices recovered within three days and have reached record levels since 4 th June 2024, registering an increase of 12.9% and 13.3% respectively as on 18 th July, 2024.

The decrease of around ₹30 lakh crore in market capitalisation of companies listed on NSE and BSE on 4 th June, 2024 was recovered within a period of five days and it has increased by around ₹59 lakh crore since then as on 18 th July, 2024.

Securities and Exchange Board of India (SEBI), as the statutory regulator of securities markets, is mandated to put in place regulatory and surveillance frameworks for effecting stable operations and development of the securities markets.  It conducts regular surveillance of trends in the securities markets to enhance market integrity and safeguard interest of investors. Any alleged violation of its Regulations is investigated and based on the findings of the investigation, appropriate enforcement action is initiated by SEBI under the powers given by the SEBI Act, 1992. Though SEBI has received representations on the above stock market movements, no specific information on any unfair trading has been provided.

The current status of funds invested by various arms of Government like SBI, LIC and other Public Sector Banks in the share market is at Annexure - A.

The details of 100 largest sellers, category-wise, on 3 rd June, 2024 on the stock exchanges are at Annexure - B.

***

## Annexure- A

Table 1: Status of funds invested by LIC and other Public Sector Banks in the share market

| S.No.                                                                                                    | Name of Organisation                                                                                     | Value of Investments (in ₹ crore, as on 31 st March 2024)                                                |
|----------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------|
| 1.                                                                                                       | Life Insurance Corporation of India (LIC)                                                                | Book Value of Equity Investments: 7,42,310 Market Value of Equity Investments: 14,58,696                 |
| Exposure of Public Sector Banks (PSBs) to the listed equity market (in ₹ crore , as on 16 th July 2024): | Exposure of Public Sector Banks (PSBs) to the listed equity market (in ₹ crore , as on 16 th July 2024): | Exposure of Public Sector Banks (PSBs) to the listed equity market (in ₹ crore , as on 16 th July 2024): |
| 2.                                                                                                       | State Bank of India                                                                                      | 8,509.13                                                                                                 |
| 3.                                                                                                       | Punjab National Bank                                                                                     | 3,787.57                                                                                                 |
| 4.                                                                                                       | Canara Bank                                                                                              | 2,515.89                                                                                                 |
| 5.                                                                                                       | Indian Overseas Bank                                                                                     | 2,186.76                                                                                                 |
| 6.                                                                                                       | Bank of Baroda                                                                                           | 2,096.65                                                                                                 |
| 7.                                                                                                       | Central Bank of India                                                                                    | 799.60                                                                                                   |
| 8.                                                                                                       | Union Bank of India                                                                                      | 502.19                                                                                                   |
| 9.                                                                                                       | Indian Bank                                                                                              | 247.08                                                                                                   |
| 10.                                                                                                      | UCO Bank                                                                                                 | 235.25                                                                                                   |
| 11.                                                                                                      | Bank of India                                                                                            | 174.79                                                                                                   |
| 12.                                                                                                      | Bank of Maharashtra                                                                                      | 80.74                                                                                                    |
| 13.                                                                                                      | Punjab &Sind Bank                                                                                        | 34.66                                                                                                    |

Source: LIC, PSBs

***

## Annexure- B

Table 1: 100 largest sellers on 3 rd  June, 2024 on NSE (Cash segment)

| Client Categories   |   No. of Clients | Gross Sell Value (in Rs. Crores)   |
|---------------------|------------------|------------------------------------|
| Others              |               38 | 54,210.96                          |
| FPI                 |               27 | 10,658.31                          |
| Mutual Fund         |               21 | 15,572.79                          |
| Retail              |                7 | 4,544.36                           |
| Insurance           |                6 | 2,566.45                           |
| PMS                 |                1 | 362.52                             |
| Total               |              100 | 87,915.39                          |

Table 2: 100 largest sellers on 3 rd  June, 2024 on BSE (Cash segment)

| Client Categories   |   No. of Clients | Gross Sell Value (in Rs. Crores)   |
|---------------------|------------------|------------------------------------|
| Retail              |               79 | 6,317.86                           |
| FPI                 |               13 | 342.01                             |
| Insurance           |                3 | 222.03                             |
| Mutual Fund         |                5 | 201.85                             |
| Total               |              100 | 7,083.75                           |

Source: SEBI

Note:    a. 'Retail' includes HUF, Individual/Proprietorship Firms, NRI and Partnership Firm / Limited Liability Partnership.

b. 'Others' includes Public & Private Companies/Bodies Corporates, Trust/Society, Domestic Financial Institutions (Other than Banks & Insurance), Statutory Bodies, New Pension System, Non-Govt.  Organisation,  Non-Banking  Financial  Company  (NBFC)  and  Domestic  Venture Capital Fund.

c. FPI: Foreign Portfolio Investors, PMS: Portfolio Management Service

***