Despite high inflation, currency swings, geopolitical uncertainties, and an onslaught of FII selling, 2022 proved to be a good year for Indian equity markets. YTD, the Nifty and Sensex have risen nearly 2.42 percent and 2.51 percent, respectively.
However, despite a solid performance by the domestic indices, some stocks have eroded investors' wealth. In 2022, 12 stocks in the Nifty 100 Index had eroded investors' wealth by 25-60%. Among the top laggards, 40% of stocks are tied to the IT pack, and 25% are related to new entrants.
Shares of One 97 communications, Paytm's parent company stood at the top of the list. The stock lost 61.7% of its value in 2022, falling from ₹1,334.55 apiece to the current market price of ₹512.15.
On December 13, 2022, the board of directors of Paytm approved the proposal for the buyback of the company's shares at ₹810 per share. However, the buyback plan fails to cheer investors' sentiment towards the stock.
Even at the buyback price of ₹810 per share, investors who bought shares in the IPO for ₹2,150 each and stayed invested are still down 62.32%.
Since its listing, the stock has been falling, and it has never traded above its IPO price to date. At the current market price of ₹512.15, the stock is available at a discount of 76.17% from its issue price, bringing the Vijay Shekhar Sharma-led company's market capitalization below ₹35,000 crore.
However, global brokerage firm J.P. Morgan has given an overweight rating on the stock with a target price of ₹1,100 per share, following the company's buyback announcement.
Gland Pharma, a pharmaceutical firm, was another stock that lost investors' wealth in 2022. The stock began its downtrend at the start of the year around ₹3,864 apiece, and it has remained in the same trend to date, falling 58.73% to ₹1594.5.
The stock lost nearly 40% of its value since October 25, after the company's consolidated net profit drops 20% YoY to ₹241.24 crore for the September ending quarter.
| Scrip Name | LTP | % YTD fall (as on 27-12-22) |
| Paytm | 512.1 | 61.7 |
| Gland Pharma | 1594.5 | 58.73 |
| Nykaa | 150 | 56.98 |
| Zomato | 58.8 | 55.3 |
| Samvardhana Motherson International | 73.3 | 50.72 |
| Wipro | 385.0 | 46.18 |
| Tech Mahindra | 1006.9 | 41.6 |
| MphasiS | 1937.1 | 39.8 |
| LTIMindtree | 4407.7 | 38.5 |
| Muthoot Finance | 1062.0 | 27.9 |
| Info Edge (India) | 3936.3 | 27.1 |
| Biocon | 264.9 | 25.3 |
| Source: Trendlyne |
Shares of FSN E-Commerce Ventures (Nykaa) were another big laggard this year. The stock has lost over 56.98% of its value year-to-date (YTD), dropping from ₹350.26 apiece to the current level of ₹150.65.
Pre-IPO investors have been selling their shares in the company ever since the company's bonus shares started trading on exchanges. To compound matters, Nykaa CEO Arvind Agarwal resigned from the company in November, the company said in a regulatory filing.
The next on the list was Samvardhana Motherson International, an auto ancillary firm. The stock had a rough start to the year, plunging 33% in the first two months. The stock has held on to the same momentum by correcting 50.72% to date, sliding from ₹148.87 apiece to ₹73.35.
Out of the last eleven months, the stock recorded nine months with losses, with January being the biggest monthly fall with 19.61%.
While, domestic brokerage firm, Motilal Oswal picks this auto ancillary stock as its top pick for 2023, citing growth opportunities. The stock is rated "buy" by the brokerage, with a target price of ₹95 per share.
IT Major Wipro, stood as the sixth top loser in the Nifty 100 Index in 2022. The stock has dropped steadily since the beginning of 2022 with no sign of relief. At current levels, the stock is trading close to its December 2020 lows.
So far in the current year, the stock has corrected by 46.18%, falling from ₹715.35 apiece to the current level of ₹385. The company's second-quarter number fell short of analyst estimates.
After the September quarter results, the domestic brokerage firms have given mixed signals on the stock. ICICI Securities cut its revenue estimates for Wipro by 0.6% and 1.4% for FY23 and FY24 due to slowing demand in the consulting business.
Similarly, other major IT stocks, such as Tech Mahindra, Mphasis, and LTI Mindtree, have corrected between 38 and 41% this year.
Ever since analysts predicted a potential recession in the US, the UK, and the Euro Zone, the value of IT stocks has started beating down.
Meanwhile, other stocks, including Muthoot Finance, Info Edge (India), and Biocon, also witnessed sharp losses this year, falling in the range of 25–28%.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.
