ZEE, Voda Idea, RBL Bank: 14 NSE500 stocks enter 'Bear' zone in Samvat 2080

Stock market in Samvat 2080: Zee Entertainment Enterprises, CreditAccess Grameen, Vodafone Idea, and Rajesh Exports were among the 14 stocks that entered Bear zone in Samvat 2080

Stock market in Samvat 2080: India stock markets, largely, had a cracker of a year with benchmarks -- BSE Sensex, and NSE Nifty50 -- soaring over 20 per cent each in the outgoing Samvat 2080.

 

At the headline level, the Nifty50 index has surged 25.94 per cent thus far in Samvat 2080 (till October 24, 2024), while the broader Nifty500 index has leaped 32.59 per cent. 

 

Not all stocks, however, minted money for investors during the period. An analysis of Nifty 500 stocks shows that 14 stocks from the index stocks entered the 'Bear' phase in Samvat 2080.

 

The list includes the likes of Zee Entertainment Enterprises (down 49.82 per cent), CreditAccess Grameen (41.89 per cent), Vodafone Idea (41.23 per cent), and Rajesh Exports (40.99 per cent). That apart, RBL Bank, Ujjivan Small Finance Bank, IIFL Finance, Easy Trip Planners, Equitas SFB, Syrma SGS Technology, IDFC First Bank, and Tanla Platforms tumbled between 20 per cent and 30 per cent.

 

A security, whether stock or index, enters a 'bear' phase when it sinks 20 per cent or more during a given period of time.

 

That apart, 21 stocks from the Nifty500 universe entered the 'Correction' phase -- a decline of 10-20 per cent in a stock or an index -- in Samvat 2080.

 

These include APL Apollo Tubes, Tata Elxsi, Birla Corporation, Bata India, The Ramco Cements, IndusInd Bank, Cera Sanitaryware, Raymond, Sanofi India, Dalmia Bharat, VIP Industries, Bandhan Bank, One97 Communications (Paytm), Shree Renuka Sugars, and Sun Pharma Advanced Research Company (SPARC) among others.  

 

According to analysts, the Bear or Correction across sectors and stocks in Samvat 2080 was a blend of macroeconomic pressures and company-specific challenges. 

 

Vodafone Idea, for instance, suffered from regulatory uncertainty due to adjusted gross revenue (AGR) verdict by the Supreme Court, coupled with profitability concerns, while banks such as Ujjivan SFB faced weak earnings and asset quality issues.

 

Paytm, too, had regulatory concerns, while Bandhan Bank investors fretted over the appointment of a new MD and CEO and the outcome of a forensic audit by the National Credit Guarantee Trustee Company (NCGTC).

 

Cement and sugar companies, including Dalmia Bharat and Renuka Sugars, were hit by rising costs, weak earnings and fluctuating commodity prices, whereas firms in discretionary segments like Raymond and Bata India struggled with high operational expenses and subdued consumer demand, analysts pointed out.

 

Technology stocks such as Tata Elxsi and Sonata Software saw corrections amid global IT spending concerns and growth slowdowns.

 

"The broader macro environment—marked by high interest rates, tight liquidity, and volatile markets—compounded these pressures, impacting debt-heavy or cost-sensitive businesses more severely," said Nirav Karkera, head of research at Fisdom.

 

Turnaround or more pain ahead?

Analysts cautioned that a potential recovery in these stocks might depend on macro developments, such as the trajectory of inflation and interest rates, along with government policies that could stabilise sectors like telecom and banking. 

 

On a broad level, analysts said Samvat 2081 may see bottom-up stock picking. Investors, they advised, should steer clear of companies where narratives are influencing stock prices more than actual earnings.

 

"We have been advising investors to readjust their portfolios in favour of large-cap stocks due to better risk reward ratio. Also, it is better to reduce exposure to stock with stretched valuation especially in the capital goods, engineering, and infra space in favour of IT services, private sector banks, and healthcare," suggested Gaurav Dua, senior vice-president and head of capital market strategy at Sharekhan by BNP Paribas.

 

While many mid- and small-cap companies possess strong business potential for the next 3-5 years, Rakesh Vyas, co-chief investment officer and portfolio manager at Quest Investment Advisors, said investors should be prepared for potential volatility in these stocks in the near-term.

 

Overall, sectors such as industrials, capital expenditure-related stocks, power and utilities, pharmaceuticals (contract development and manufacturing organisations), and financial services are expected to either maintain a growth trajectory or offer attractive valuations, he advised. 

Source: ACE Equity | Note: Data till Oct 24, 2024