Among the worst-hit were blue-chip stocks such as Tata Motors, Reliance Industries Ltd (RIL), State Bank of India, Asian Paints, Hindustan Unilever, and Titan, all of which sank to their 52-weeks lows on the 30-stock Sensex index.
Broader market weakness was reflected in the BSE 500 index as well, where Bank of Baroda, Angel One, Bajaj Auto, Adani Green, BEML, BHEL, Canara Bank, DMart, Dr. Reddy’s, LIC, YES Bank, and Britannia, among many others, registered fresh 52-week lows.
Asian Paints fell 2.3% to Rs 2,128.05, while Hindustan Unilever slipped 1.5% to Rs 2,158.55. Reliance Industries dropped 3.6% to Rs 1,156, while Tata Motors slid 2.3% to Rs 606.2. State Bank of India and Titan also saw losses, hitting 52-week lows of Rs 679.65 and Rs 3,058.85, respectively.
The benchmark Nifty 50 index has witnessed its losing streak extend to eight consecutive sessions as of February end, bringing its total decline to nearly 16% from it’s all-time high of 26,277. The index now sits just 1,103 points away from entering bear market territory—a 20% drop from peak levels.
India’s midcap and smallcap stocks suffered their worst monthly losses since the COVID 19-led market meltdown of March 2020, with the BSE Smallcap index plunging 14% in February and the Nifty Midcap 100 tumbling 10.8%.Foreign portfolio investors (FPIs) have been relentless sellers, offloading more than Rs 3 lakh crore worth of Indian equities over the past five months, according to Kotak Securities. FPIs were net sellers of Rs 58,988 crore in February alone, the brokerage noted.The market weakness comes amid rising global trade tensions, particularly concerns over the potential imposition of fresh tariffs from the U.S. under the Trump administration. Indian equities have been underperforming global indices, weighed down by “increasing trade war risks over the global economy, FPIs outflows and weak corporate earnings,” Kotak Securities said in a note.
India’s economic indicators have shown mixed signals. GDP growth for the third quarter of FY25 came in at 6.2%, improving from 5.6% in the previous quarter, driven by government consumption and private sector spending. However, inflationary pressures have eased, with CPI inflation falling to 4.3% in January from 5.2% in December.
The Reserve Bank of India (RBI) cut its policy rate by 25 basis points in February, signaling a more accommodative stance. However, Kotak Securities said it expects the central bank to remain cautious given global uncertainties, including potential U.S. trade tariffs, the U.S. Federal Reserve’s hawkish stance, and sustained capital outflows.
Despite the selloff, the brokerage suggests that India remains the world’s fastest-growing major economy, with GDP growth projected at 6.5% for FY26. “Under the current market condition, investors need to adopt a judicious and selective approach to add quality stocks on corrections for long term perspective,” Kotak Securities said.
The broader underperformance of Indian equities relative to global peers has led to a valuation reset across multiple sectors. While Nifty 50 still trades above its historical forward price-to-earnings average, smallcap and midcap stocks have seen sharper earnings downgrades following weak Q3 results.
Also read | Nifty 1,100 points away from official bear market zone: Time for greed or fear?
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
