TRENT crashes 15%, THEMISMED, EDELWEISS plunge as selloff grips Indian markets on April 7

A sweeping selloff gripped Indian stock markets on April 7, 2025, as investors offloaded holdings across sectors, pushing several key stocks into double-digit losses. Among the worst performers were TRENT, THEMISMED, and EDELWEISS, each shedding over 10% by market close. The widespread decline was not limited to individual companies but reflected a broader deterioration in investor sentiment amid macroeconomic uncertainty, persistent inflation, foreign institutional investor withdrawals, and growing unease over policy stagnation.

The benchmark indices closed significantly lower, with the BSE and NSE mid-cap and small-cap indices bearing the brunt of the volatility. Nearly 20 stocks on the BSE fell by more than 10%, indicating a broad-based risk-off move.

What triggered TRENT’s steep fall and what does it signal for retail stocks?

TRENT Limited led the list of top losers, plunging 14.70% from a previous close of ₹5,562.85 to ₹4,745.05. The stock, which had been trading at historically high valuations due to strong growth in its retail formats like Westside and Zudio, faced heavy profit-booking. Analysts noted that while the company’s fundamentals remain intact, recent price appreciation outpaced near-term earnings potential.

TRENT’s decline underscores growing investor caution toward consumer-facing retail stocks. Elevated valuations across the discretionary retail sector are now being reassessed in light of inflationary concerns that could erode purchasing power in India‘s emerging middle class. Historically, the sector has seen cyclical corrections when interest rates remain high for extended periods, as is currently the case with the Reserve Bank of India maintaining the repo rate at 6.5%.

How did pharma stocks like THEMISMED fare amid changing cost dynamics?

THEMIS Medicare Ltd declined by 14.89%, dropping from ₹139.23 to ₹118.50. The pharmaceutical company, known for its API and formulation products, had earlier enjoyed a surge in investor interest during FY24 due to export orders and new approvals. However, the sharp correction reflects recent challenges in the pharma space, where cost pressures linked to active pharmaceutical ingredients, regulatory pricing restrictions, and supply chain volatility have raised concerns over profit margins.

Historically, mid-cap pharma companies are more vulnerable to earnings swings due to their dependence on a limited product pipeline. The segment is also facing increased competition from domestic peers and international players in key therapeutic categories such as anti-infectives and pain management.

Why did EDELWEISS drop and what are the implications for NBFCs?

EDELWEISS Financial Services fell 10.96% to ₹78.05 amid broader selling pressure in the financial services space. While the company has diversified interests across wealth management, insurance, and asset reconstruction, the drop signals market concerns around slower recovery in key verticals such as stressed asset resolution.

The NBFC sector has faced multiple headwinds over the past year, including liquidity tightening, increased regulatory scrutiny, and margin compression. The RBI’s tighter norms on provisioning for non-performing assets and enhanced capital requirements for shadow banks are also weighing on sentiment. Investor apprehension has been further stoked by growing risks in the unsecured lending segment, an area where many mid-tier NBFCs, including EDELWEISS, have been actively engaged.

What led to widespread declines in mid-cap and industrial stocks?

ONWARD Technologies, which fell 14.27%, exemplified the pressure in mid-cap IT and engineering services. The company saw its share price drop to ₹209.00 despite a high of ₹234.95 earlier in the session. Investors appear to be reassessing growth forecasts amid a slowdown in order inflows from Europe and North America. The broader trend of cautious IT spending by global firms continues to drag export-oriented Indian technology services players.

Jindal Drilling and Industries, down 13.90%, was also caught in the market downdraft. While energy services companies have benefited from elevated crude oil prices, the volatility in offshore exploration budgets has made investors wary. Historically, stocks in this segment are susceptible to cyclical investment downturns, especially when geopolitical risks disrupt project timelines or financing.

CARRARO India declined 13.69%, as the auto component manufacturer faced fallout from supply chain issues and raw material cost escalation. Similar pressure was observed in MAHK Technologies, which lost 12.75%, and SP Apparels, which fell 12.72%, revealing continued strain across industrial manufacturing and textile export segments.

Why are retail investors avoiding rights entitlement shares like ABIN-RE1 and IRIS-RE?

Among the worst performers were retail rights entitlements—ABIN-RE1 fell 18.87% and IRIS-RE dropped 15.42%. These instruments, tied to recent rights issues by parent companies, struggled due to muted investor participation and uncertainty around long-term business viability. Rights entitlements often attract speculative interest but can quickly become illiquid if demand fails to materialize during the trading window.

The decline in these entitlements highlights retail investor caution, especially in companies with weaker balance sheets or ambiguous turnaround narratives. Historically, under-subscribed rights issues have often preceded further share price declines for the parent stock, making entitlements a risky bet during market downturns.

How are digital platforms and new-age stocks responding to valuation fatigue?

CarTrade Tech Ltd declined 12.34% to ₹1,466.00 despite strong operational performance in FY24. The drop reflects broader disillusionment with richly valued digital-first businesses, particularly those in the post-IPO cohort. With rising interest rates and capital costs, investors are demanding visible profitability and operational leverage—both of which remain elusive in many tech-driven marketplaces.

Similarly, Genesys International fell 11.20% to ₹558.00, dragged by worries over payment delays from government clients and project execution lags. The stock had previously rallied on digital mapping initiatives under India’s infrastructure modernization drive, but concerns around funding and fiscal constraints have tempered expectations.

What is the outlook for textiles and export-focused sectors amid currency volatility?

PRECOT saw a decline of 11.57%, while SANGAM India dropped 10.98%, both impacted by declining export orders and rising input costs. Cotton prices remain volatile, and continued currency fluctuation has made Indian exports less competitive compared to Southeast Asian producers.

Export-driven textile manufacturers have historically struggled during periods of global trade slowdown. The Red Sea shipping disruptions, which continue to raise freight costs, are adding further pain to already strained logistics. These pressures are mirrored in SURAJ Estate Developers and BEARDSELL Ltd, which lost 11.01% and 11.04%, respectively.

What are investors watching next as market volatility increases?

The April 7 selloff was exacerbated by broader macroeconomic uncertainty. March’s Purchasing Managers’ Index (PMI) showed slowing manufacturing expansion, while crude oil prices remained elevated due to Middle East tensions. With the Reserve Bank of India maintaining a hawkish stance in its latest policy review, the probability of a near-term rate cut appears diminished.

Foreign portfolio investors, who were net sellers of ₹8,000 crore over the past fortnight, remain cautious. The lack of progress on key tax reforms and privatisation plans has further dampened enthusiasm. As earnings season begins, investor focus will likely shift to guidance and commentary on margin pressures, demand visibility, and capital expenditure plans.

Although some of the sharp corrections may invite bargain-hunting, the broader market remains susceptible to global shocks and domestic policy inertia. As history has shown in similar episodes, sharp downswings often create short-term volatility but also offer longer-term entry points for patient investors focused on quality fundamentals.