Punjab & Sind Bank, UCO Bank, Voltas lead sharp sell-off as top Indian stocks fall on April 1

The Indian stock market kicked off the new financial year with a broad-based decline on April 1, 2025, as multiple sectors saw sharp corrections amid resurfacing macroeconomic concerns and investor caution ahead of key policy decisions. Public sector banks, pharmaceuticals, and consumer discretionary names dominated the list of top losers, with stocks such as Punjab & Sind Bank, UCO Bank, Voltas, Suven Pharmaceuticals and Info Edge (India) Limited among the steepest decliners.

Sentiment weakened further as global economic indicators suggested that inflation might remain stickier than expected, with oil prices firming up and interest rate cuts pushed further down the timeline in major economies. The Reserve Bank of India’s upcoming monetary policy meeting added a layer of uncertainty, prompting investors to pull back from sectors sensitive to rate cycles and global demand.

Among the worst-hit was Punjab & Sind Bank, which posted a staggering 20.01 percent loss to close at ₹34.86. The sharp drop came after the stock had gained significantly over the past two quarters amid optimism around PSU bank restructuring and credit growth. However, the dramatic reversal appears to reflect growing investor discomfort with public sector lending exposure and asset quality risks.

UCO Bank followed closely, falling 12.61 percent to ₹31.20. The bank saw heightened trading volumes as concerns resurfaced about whether last year’s surge in government-owned bank stocks had run ahead of fundamentals. Historically, PSU banks have been cyclical performers, often rallying during periods of fiscal expansion or rate cuts. But with the Reserve Bank of India maintaining a hawkish stance amid sticky core inflation and global liquidity tightening, appetite for these stocks has cooled dramatically.

What role did interest rate uncertainty play in driving losses across sectors?

The expectation that India’s central bank will extend its pause on interest rate cuts contributed significantly to selling pressure. Higher-for-longer rate expectations weigh heavily on banks, real estate, and discretionary consumption, as borrowing costs stay elevated and credit demand softens.

Consumer-facing companies like Voltas Limited, which dropped 7.56 percent to ₹1,348.40, were hit hard. The air conditioning and engineering services firm is entering peak summer demand season, but worries over rural consumption and inflation-hit margins weighed heavily. While the company has a strong presence in cooling products, its profitability remains vulnerable to input cost fluctuations and currency volatility, both of which have re-emerged as market concerns in recent weeks.

Similarly, Hatsun Agro Product Limited slipped 6.22 percent to ₹904.20. As one of India’s largest private dairy processors, the company faces persistent cost pressures in milk procurement and logistics. The dairy sector, although resilient in periods of economic stress, has shown vulnerability to commodity price volatility and uneven demand patterns.

Why are pharma stocks facing renewed selling pressure in 2025?

Pharmaceutical companies were another weak spot in the market, with multiple counters facing pressure from regulatory and pricing challenges. Ipca Laboratories Limited declined 6.65 percent to ₹1,402.00, while Suven Pharmaceuticals Limited lost 6.27 percent to ₹1,078.85. The sector has long relied on exports to the US and EU, but increasing scrutiny from the USFDA, coupled with price erosion in generics, has made earnings recovery slower than anticipated.

Neuland Laboratories Limited, a specialist in complex generics and APIs, also saw its stock drop 5.19 percent to ₹11,444.80. Despite steady demand for niche molecules, the stock has shown increased volatility due to concerns about capacity utilization and export dynamics.

Vaishali Pharma Limited, another smaller player, was down 7.79 percent to ₹11.60. Investors appear wary of smaller pharma firms with high dependency on low-margin markets and inconsistent regulatory clearances.

Is tech and IT sentiment weakening again in Indian markets?

Technology and internet services stocks, which had seen a brief rebound in early 2025, appeared to resume their correction amid weak earnings visibility. Info Edge (India) Limited, which owns the Naukri brand, fell 5.48 percent to ₹6,787.60. The stock had surged earlier on hopes of strong hiring trends, but with India’s IT services export growth slowing and domestic job creation stabilizing, investor enthusiasm has cooled.

OneSource Techmedia Limited, a relatively small media-tech firm, also declined 7.99 percent to ₹1,612.20. Smaller cap tech stocks are particularly vulnerable in risk-off environments, where liquidity flows to larger, more stable players.

How are financial services and wealth management firms being affected?

Wealth management firms and financial intermediaries were not spared in the day’s correction. 360 One WAM Limited dropped 5.60 percent to ₹889.90, while Prudent Corporate Advisory Services Limited fell 5.80 percent to ₹2,201.10. These firms tend to perform well in bullish markets where retail participation and asset inflows are strong. However, with investors shifting money towards fixed income and debt instruments amid rate uncertainty, revenue growth for these players faces near-term headwinds.

Keynote Financial Services Limited also fell 5.52 percent to ₹283.20. As a smaller financial advisory firm, it remains sensitive to sentiment shifts in capital markets and transaction volume, both of which appear to be weakening temporarily.

Are industrial and manufacturing stocks also feeling the pinch?

Manufacturing and engineering-linked stocks showed notable weakness. Atul Limited, a diversified chemicals company, lost 5.49 percent to ₹5,800.00 as sector-wide commentary pointed to lower industrial demand and margin pressures in specialty chemicals.

VST Tillers Tractors Limited, which operates in the agri-machinery segment, slipped 5.23 percent to ₹3,678.40. Rural demand recovery remains muted and delayed government procurement has impacted sentiment in the mechanised farming space.

Maharashtra Scooters Limited, which is part of the Bajaj Group and serves as a holding company, declined 5.52 percent to ₹10,605.00. The company’s performance tends to correlate with broader industrial and auto cycles, which currently remain subdued.

TCPL Packaging Limited, a major supplier in the packaging space, fell 5.41 percent to ₹4,318.35. While demand for packaged goods has remained relatively resilient, rising raw material costs and energy prices have put pressure on margins in this capital-intensive business.

What’s driving sentiment in microcap and penny stocks?

Even the lowest-priced stocks were not immune. Quintegra Solutions Limited, a penny stock, dropped 5.23 percent to ₹1.63. Thin liquidity and lack of institutional backing make such stocks highly susceptible to sharp daily swings.

Jaiprakash Associates Limited, once a major infrastructure conglomerate, also declined 5.13 percent to ₹2.96. The company has long struggled with debt overhang and asset divestments, and its stock remains speculative despite recent restructuring efforts.

What broader market signals are emerging from this widespread sell-off?

While the top 20 losers reflect a mix of sector-specific concerns, the wider market weakness signals risk aversion among both domestic and foreign institutional investors. The BSE Sensex and NSE Nifty also closed in the red, dragged by losses in banking, pharma, FMCG and tech counters.

Foreign portfolio investors were net sellers, mirroring global risk-off sentiment, while domestic institutional investors offered some support but failed to offset the intensity of the sell-off. The Indian rupee weakened against the dollar, further weighing on companies with high import bills and foreign debt exposure.

Oil prices have also firmed up in recent sessions, which could translate into higher input costs and inflationary spillover. With the Reserve Bank of India expected to hold rates steady at its next policy meeting, the absence of rate relief is compounding investor caution.

The start of Q1 FY26 earnings season will now be a crucial determinant of near-term sentiment. Investors are likely to remain selective, favouring companies with stable cash flows, robust margins and low global dependency. For now, April has opened with a reality check for markets that had priced in a much smoother economic transition than the data currently suggests.