According to latest data, seven prominent Nifty companies have delivered zero returns over the past five years, with some experiencing significant underperformance. The list includes Tata Consultancy Services, Infosys, Hindustan Unilever, HDFC Bank, Asian Paints, HDFC Life Insurance, and Wipro. Despite being market leaders in their respective sectors, these companies have struggled with different combinations of growth challenges, valuation pressures, and sector-specific issues that have impacted their stock performance. However, recent market maturity has shown investors are no longer painting all sectors with the same brush when one faces trouble, leading to more selective investment approaches. The common thread across these seven stocks is that investors had paid heavy price for certainty, many of these companies traded at rich valuations for years because they were seen as stable, predictable and difficult to disrupt.
As reported by Upstox, TCS has been the worst performer, falling 36.7% over five years, while Infosys has declined 34.3%. Wipro has also underperformed significantly, declining 42.7% over the same period. This year, IT stocks are facing selling pressure driven by a combination of technology disruption fears, weak discretionary spending, and slower US demand. Brokerages have expressed concerns that AI-driven productivity gains may lead to lower billing volumes and increased pricing pressure. The Nifty IT index has lost approximately a fifth this year, with its 10 constituents losing $73 billion in market value. Infosys has also faced company-specific pressure from weak guidance, with FY27 constant currency revenue growth guidance of 1.5-3.5% pointing to continued demand uncertainty, while another guidance cut after Q1 kept brokerages cautious. Analysts also flagged weak demand, AI-led pricing pressure and client-specific issues as near-term headwinds.
According to Upstox, Hindustan Unilever has declined 22.9% over five years, dealing with weak rural demand, inflation pressure, and rising competition. The company's shares hit a 52-week low of ₹2,006.2 on NSE on August 24, with investors worried about margin pressure from sustained cost inflation. In Q1FY27, HUL's net profit declined by 3% YoY to ₹2,673 crore, while volume growth came in at 5% YoY. Revenue from operations rose by 10% YoY, but Q1 profitability and volume growth missed market expectations as elevated prices for palm oil, crude derivatives and other raw materials have led to lower EBITDA margins. HUL's volume growth has faced challenges amid slow recovery in rural demand and mass skincare category, rising competition in the entry-level segment, and sluggish volume growth impacting investor sentiments.
As reported by Upstox, HDFC Life Insurance has fallen 17.6% over five years due to slower growth and pressure on profitability metrics. The company's June quarter showed value of new business rising 9% year-on-year and annual premium equivalent also growing 9%, but individual APE remained muted with underperformance in the bank channel. VNB margin declined 10 basis points YoY to 25%. The company has also had to deal with regulatory changes, product mix shifts and pressure on savings products. Asian Paints has declined 13.3% as demand in decorative paints weakened, raw material costs rose, and competition intensified after the entry of Birla Opus. The paint industry has seen disruption with the entry of deep-pocketed new companies like Grasim's Birla Opus, which has reached 10% market share in the organised decorative paint segment and currently has the 2nd largest capacity. Volatile crude oil prices directly impact Asian Paints' operating profit margins as crude derivatives make up over half of their input materials and price increases cannot be passed immediately to buyers.
According to Upstox, HDFC Bank has been the least negative among the seven, down 6.4% in five years, but its underperformance has hurt because it was once treated as one of India's most reliable compounders. The stock hit a 52-week low of ₹715.1 on NSE earlier this month despite healthy growth in its core business. In Q1FY27, HDFC Bank reported 15.4% YoY increase in gross advances to ₹30.6 lakh crore. However, the main issue has been the merger with HDFC Ltd, which increased the bank's balance sheet by ₹7.23 lakh crore but brought a smaller deposit base, putting pressure on margins and returns. The absorption of HDFC added ₹7.23 lakh crore of assets but a relatively small deposit base, squeezing margins and dragging on growth. The stock also saw pressure after leadership-related concerns and boardroom strains earlier this year. As per Upstox, HDFC Bank's Net Interest Margin (NIM) of 3.26% in Q1FY27 was lowest on record as the merger brought a large low-yielding home loan portfolio alongside high-cost borrowings. FIIs outflow has also increased in recent quarters, with HDFC Bank's FII holding reducing to 41.82% at the end of June 2026 quarter from 44.05% at the end of March 2026 quarter.
Despite the underperformance of heavyweight stocks, the NIFTY50 index has delivered a positive return of over 50% in the last five years as strong performance of other financial stocks, metal and telecom sectors has offset weakness in individual heavyweights. However, this year presents a stark contrast with nearly half of BSE 200 companies failing to generate returns, as reported by The Economic Times. As many as 97 BSE 200 companies, accounting for 49% of the index, have not yielded returns year-to-date. The benchmark Sensex has declined nearly 9% this year, dropping to 77,264 on August 28 from 85,220 on January 1. The majority of underperforming companies were from sectors including automobiles, cement, FMCG, and IT, with the year-to-date trend similar to the first eight months of 2025. This marks a deterioration from the comparable periods of 2023 and 2024, when only 10-20% of the index constituents failed to generate returns. The weakness is notable across several sectors and not just confined to one particular sector, with FMCG stocks under pressure from slowing consumption growth and rising raw material costs, while capital goods stocks have outperformed driven by higher government spending on infrastructure.
