Top Indian stock losers: Wendt, Solara, Muthoot, Chemcon drag NSE lower

Indian stock markets witnessed sharp volatility on May 15, 2025, with the Nifty and Sensex drifting lower amid broad-based selling in mid-cap and small-cap counters. The day’s most notable losses came from a mix of rights entitlements, industrials, pharma, NBFCs, and microcaps. Leading the pack were Wendt India Limited, LLOYDS Engineering RE1, Solara Active Pharma Sciences Limited, and Muthoot Finance Limited, each shedding over 6–17% in a single session.

The top 20 losers table on the BSE paints a picture of elevated caution and rapid de-risking by investors. Institutional selling intensified in specific segments, particularly non-banking financial companies (NBFCs), specialty chemicals, and mid-cap pharma stocks. The aggregate value wiped out from these stocks was estimated at over ₹1.10 lakh crore, according to market cap calculations based on average volumes and last traded prices.

What Triggered the Selloff in Lloyds RE1 and Avantel RE?

LLOYDS-RE1, the rights entitlement for Lloyds Engineering Works Limited, crashed 25.72%, closing at ₹18.11 from a previous close of ₹24.38. The collapse reflects the market’s diminishing appetite for low-liquidity speculative rights instruments nearing the end of their trading window. Such instruments often trade at deep discounts as investors rush to exit ahead of record dates or allocation cut-offs.

Similarly, Avantel-RE dropped 12.02%, closing at ₹67.90. Although the core Avantel business in defence communications remains strong, the rights market saw speculative unwinding as volumes spiked past 5.7 lakh shares. With no immediate catalysts and regulatory timelines tightening, traders sought to monetise holdings quickly, leading to steep discounts.

Why Did Wendt India Fall Despite Strong Fundamentals?

Shares of Wendt India Limited declined 17.3% to close at ₹8,650. The fall surprised many given the company’s robust order pipeline in abrasives and superabrasives manufacturing. However, the stock had rallied almost 50% year-to-date, and traders indicated this was a classic case of valuation correction. High institutional ownership and limited free float may have exacerbated the decline as liquidity dried up.

Notably, the fall coincided with a broader drop in industrial and capital goods counters as investors rotated capital into large-cap defensives amid global macro uncertainty.

What’s Behind Solara Pharma’s Sharp Decline?

Solara Active Pharma Sciences Limited was down 10% at ₹518.05. The company, which specialises in active pharmaceutical ingredient (API) manufacturing, has been under pressure since the beginning of 2025 due to capacity underutilisation, pricing pressures from U.S. clients, and quality-related compliance costs. Thursday’s selloff followed analyst downgrades citing weak Q4 earnings guidance and competitive pressure in emerging markets.

The broader mid-cap pharma space saw similar declines as regulatory inspections and price erosion dampened investor optimism.

NBFCs Drop on Weak Lending Sentiment: Muthoot Finance and Muthoot Capital Hit

Muthoot Finance Limited lost 6.72%, ending the day at ₹2,108. The gold loan financier is facing mounting challenges amid rising interest rates, tepid rural gold loan demand, and declining loan-to-value ratios. With the Reserve Bank of India likely to maintain a hawkish stance into Q2 FY26, cost of funds for NBFCs may continue to rise, further pressuring net interest margins.

Muthoot Capital Services Limited also shed 6.98%, in line with peer group moves. Investors grew cautious about vehicle loan disbursements in semi-urban India, where disposable income recovery post-pandemic remains patchy.

Rights-Based Stocks and Penny Shares Continue to Slide

In addition to Lloyds and Avantel RE instruments, Max India-RE fell 9.37%. With lower subscription interest and weak future conversion prospects, several rights entitlements came under intense liquidation pressure.

Penny stock Godha Cabcon & Insulation Limited declined 5.26%, closing at ₹0.54. Despite trading at nearly zero book value, the stock witnessed 3.13 crore shares change hands, reflecting speculative volume churn in low-float microcaps amid broader risk aversion.

Why Did Power India and SGIL Decline Despite Infra Hopes?

Hitachi Energy India Limited (Power India) dropped 6.6%, ending at ₹15,630. This fall came as a surprise, given the company’s solid position in the electrical infrastructure and renewables sector. Analysts believe the fall was largely technical, with profit booking triggered after the stock’s recent 10% rally.

Similarly, Satia Industries (SGIL) dropped 7.42% amid investor concerns about capital expenditure delays and margin pressures in industrial paper supply, especially to state governments.

Educational and IT Service Stocks See Weakness: NIIT MTS and Inspirisys Decline

NIIT MTS slipped 6.58%, closing at ₹348.60. The IT training firm has seen its B2B enterprise skilling contracts slow down as corporates cut back on L&D budgets in Q1. Profit margins have remained under pressure, with little improvement in operating leverage despite top-line stability.

Inspirisys Solutions Limited also declined 5.14%, mirroring broader weakness in mid-tier IT services players. Deal closures in the digital government space have faced procedural delays, affecting Q1 revenue visibility.

Chemical and Fertiliser Stocks Crack on Export and Pricing Concerns

Chemcon Speciality Chemicals Limited was down 5.06%, continuing its downtrend as Chinese chemical supply rebounds and global oversupply eats into margins. Investors remain cautious on small and mid-cap chemical exporters whose input costs remain elevated.

Zuari Agro Chemicals Limited dropped 5.42% on reports that the government may delay additional urea subsidies in the upcoming Budget, placing pressure on working capital-heavy fertiliser companies.

Institutional Activity and Foreign Selling Worsen Market Breadth

Foreign institutional investors (FIIs) were net sellers by ₹2,319 crore on May 15, as per NSDL data. This marked the third consecutive session of sustained outflows, triggered by U.S. CPI inflation data, a firmer dollar, and declining probability of a near-term Fed rate cut. FIIs offloaded exposure in NBFCs, mid-cap pharma, and capital goods.

Domestic institutional investors (DIIs), including mutual funds and insurance companies, net bought ₹217 crore worth of equities, but the buying was insufficient to counterbalance the foreign selling pressure. Mutual fund houses have begun rotating into large caps and high-dividend names, reducing their exposure to smaller speculative counters.

How Is Sentiment Shaping Up Ahead of Policy and Budget Signals?

Investor sentiment remains cautious. With Q4 earnings painting a mixed picture across key sectors, institutional money appears to be adopting a “wait-and-watch” approach ahead of July’s Union Budget and the RBI’s next monetary policy decision.

Several high-beta names that performed well earlier in 2025 are witnessing valuation deratings as macro concerns grow. The rupee’s weakness, input cost inflation, and slower-than-expected rural recovery are contributing to defensive positioning among both FIIs and DIIs.

Market participants are also factoring in the possibility that the RBI could extend its pause on rate cuts through the rest of CY2025 if inflation remains sticky—especially with Brent crude edging back towards the $90 mark.

Will Volatility Persist in Indian Equities?

With global volatility resurfacing and earnings outcomes proving unpredictable, volatility is likely to persist in Indian equities, particularly among mid- and small-cap stocks. Investors are advised to monitor institutional flows, macro indicators, and company-specific guidance closely.

Stocks like Wendt India, Solara, Muthoot Finance, and Power India may attract long-term value buying if valuations correct further. However, high-leverage plays and rights-based instruments may continue to see instability until policy clarity emerges post-Budget.