Wealth Destroyers: 8 Nifty stocks wipe out Rs 13 lakh crore in eight months

New Delhi: Bloodbath continued on Dalal Street as Indian benchmark indices slumped to new 52-week lows on Friday. With the 'ache-din' rally of the post-pandemic era fizzling out after monetary policy tightening and inflationary worries, market participants are seeing deep drawdowns in their portfolios.

Benchmark indices - Nifty50 and BSE Sensex - hit yearly lows, extending the weakness for the straight sixth session.

“The next two-three months would be a transitional phase for the economy and we need to brace for higher volatility, need to stick to quality stocks and not to panic and exit,” says Siddhartha Khemka, Head of Retail Research, Motilal Oswal Financial Services.

Amid the correction seen in the index, some of its constituents have also seen a 6-41 per cent fall in their values. As many as eight index stocks have cumulatively wiped out Rs 12.76 lakh crore of investor wealth.

The majority of these index stocks are from technology, financial or banking sectors, and have the biggest weights in the index. Each of these constituents has eroded more than Rs 1 lakh crore each, since October 19.


HDFC Bank topped the wealth destroyer list as the stock tumbled 24 per cent to Rs 1,281.15 on June 16 from Rs 1,688.95 on October 19, 2021. The merger-bound private lender's market capitalization has plunged by Rs 2.23 lakh crore to Rs 7.11 lakh crore from Rs 9.35 lakh crore during the period under review.

It is followed by IT behemoth Tata Consultancy Services (TCS), whose m-cap took a hit of Rs 1.95 lakh crore as it fell to Rs 11.5 lakh crore. The stock dropped 14 per cent to Rs 3,142.35 on Thursday from Rs 3,634.6 on October 19, 2021.

Other software exporters, including Infosys (23 per cent down) and Wipro (41 per cent down) have also trimmed their respective market caps by Rs 1.78 lakh crore and Rs 1.58 lakh crore, respectively, during the period under review.

Kotak Institutional Equities said the profit warning from clients of IT companies and increasing external risks make the assumption of 6-8 per cent global IT spending growth unreasonable.

Global brokerage Nomura has also warned about the possibility of a potential slowdown in IT services demand in FY24.

The market capitalization of financial Services providers - Bajaj Finance, HDFC and Bajaj Finserv - have dropped between Rs 1.2 lakh crore to Rs 1.5 lakh crore as the stocks have fallen 40 per cent since Nifty50's climb to all-time highs.

However, Reliance Industries, despite a mere six per cent fall in the last eight months, has diminished its market capitalisation by Rs 1.16 lakh crore to Rs 17.31 lakh crore at the close of the previous session.

On the contrary, five stocks - Cipla, Maruti Suzuki, Mahindra & Mahindra, Power Grid and ITC - have added more than Rs 50,000 crore to investors' pockets since October 19. Their contribution, however, is negligible compared to the wealth eroded.

"It is better to remain relatively cautious and just keep doing the simple things that are working," said Jonathan Garner, Chief Asia & Emerging Market Strategist & Chairman of Asset Allocation, Morgan Stanley.

"Sensex at 70,000 is still achievable over the medium term but we need to avoid the global recession. It is fair to say that we have all got incrementally more cautious since then," he added.