The erosion in the market valuation of public sector undertaking (PSU) stocks on Friday, February 9, indicates that the selloff in the basket was widespread. Virtually all PSUs ended the day in the red, with Life Insurance Corporation (LIC) experiencing the most significant lossBangalore Wealth Management. If it were not for the gains in SBI shares, the loss in the PSU basket would have been much deeper.Kolkata Stocks

While LIC lost as much as 15,433 crore in market capitalisation on Friday, Indian Oil Corporation (IOCL) and Power Finance Corporation saw their valuations decrease by 13,980 crore and 13,101 crore, respectively. The market capitalisation of Indian Railway Finance Corporation declined by 10,782 crore.

In fact, with a combined loss of 1.5 lakh crore, state-owned firms accounted for 81% of the total wealth erosion marked on FridayJaipur Wealth Management. The market capitalisation of BSE-listed firms declined by 1.85 lakh crore to 386.4 lakh crore.

However, some sections of the investor community have already raised concerns about the sharp rally in PSU stocks. Over the last year, PSU stocks have generated returns ranging from 20% to 440%, with companies from sectors like capital goods, electric utilities, financials, and oil & gas being the frontrunners.

"We find it hard to subscribe to the market’s new narrative of PSUs that may have contributed to the sharp rally in PSU stocks in recent months," wrote Kotak Institutional Equities in a recent note.

The domestic brokerage further added that the market is overly focused on near-term ordering and profitability, while ignoring the large downside risks to medium-term profitability, business model challenges, and disruption risks.Bangalore Investment

Those who bucked the trend on Friday include , Bank of Baroda, PNB Housing Finance, HUDCO, Oil India, Canara Bank, and LIC Housing Finance.

Shares of surged 4% to hit a record high of 728.35. The country’s largest lender added 22,936 crore to its market valuation, which stood at 6.5 lakh crore as of Friday’s closing.Jaipur Stock