India’s equity market faced a tumultuous holiday-shortened week, with eight of the top 10 most-valued companies suffering a combined market capitalization (mcap) erosion of ₹1.65 lakh crore. Mounting concerns over rising CPI inflation and weaker-than-expected corporate earnings contributed to the sharp decline. HDFC Bank and State Bank of India (SBI) bore the brunt of the losses, mirroring the weak sentiment in equities. Trading was closed on Friday for Guru Nanak Jayanti, capping off a challenging week for investors.
Top Players Take the Hardest Hits
HDFC Bank emerged as the biggest casualty, witnessing a staggering ₹46,729.51 crore erosion in its market valuation, which now stands at ₹12,94,025.23 crore. Similarly, SBI, the country’s largest public-sector bank, saw its mcap shrink by ₹34,984.51 crore to ₹7,17,584.07 crore, further underscoring the pressures faced by financial institutions amidst inflationary fears.
Other key players also reported significant losses. Hindustan Unilever’s (HUL) valuation slumped by ₹27,830.91 crore, reducing its market cap to ₹5,61,329.10 crore. Meanwhile, Reliance Industries Ltd (RIL), the most valued firm in India, recorded a ₹22,057.77 crore dip, bringing its market capitalization to ₹17,15,498.91 crore.
The FMCG and telecom sectors were not spared. ITC’s mcap declined by ₹15,449.47 crore to ₹5,82,764.02 crore, while Bharti Airtel saw a reduction of ₹11,215.87 crore, closing the week with a market cap of ₹8,82,808.73 crore.
Life Insurance Corporation of India (LIC) also faced losses, with its valuation dropping by ₹4,079.62 crore to ₹5,74,499.54 crore. ICICI Bank’s mcap took a modest hit, falling by ₹2,832.38 crore to ₹8,85,599.68 crore.
Infosys and TCS Provide a Silver Lining
While the broader market struggled, two tech giants bucked the trend. Infosys emerged as a notable gainer, adding ₹13,681.37 crore to its market cap, which now stands at ₹7,73,962.50 crore. Tata Consultancy Services (TCS) also posted a marginal gain of ₹416.08 crore, taking its market valuation to ₹15,00,113.36 crore.
Despite the gains by these tech heavyweights, the overall mood of the market remained subdued, with inflation and earnings performance dampening investor sentiment.
Reliance Retains Top Spot; Others Follow
Reliance Industries continues to maintain its position as India’s most valued company, followed by TCS, HDFC Bank, ICICI Bank, Bharti Airtel, Infosys, SBI, ITC, LIC, and HUL.
The week’s market performance highlights the vulnerability of major companies to macroeconomic challenges, particularly in a high-inflation environment. Ajit Mishra, Senior Vice President of Research at Religare Broking Ltd, summed up the market sentiment succinctly, stating, “Mounting concerns over rising CPI inflation and persistent disappointments in corporate earnings weighed heavily on sentiment.”
Market Outlook
As investors grapple with inflation concerns and the ripple effects of lackluster corporate earnings, market stability may hinge on improving macroeconomic indicators and corporate performance. While the gains by Infosys and TCS provide hope for resilience in the tech sector, the broader market’s recovery may require a clearer roadmap on inflation and earnings improvements.
For now, the sharp decline in the mcap of these top firms serves as a reminder of the volatility that can affect even the most established players in India’s corporate landscape