Mutual funds have been trimming their holdings in a significant number of stocks for two consecutive quarters, with fund managers reducing their stakes in 84 companies listed in the BSE 500 index over the March 2026 and June 2026 periods. This sustained selling by institutional investors is a trend that market watchers are closely observing.
The impact of this reduced investment is evident in the stock prices of these companies. Of the 84 stocks where mutual funds decreased their stakes, 28 have seen their values fall by more than 10% in the calendar year 2026. Even more strikingly, 14 of these stocks have experienced a price decline between 25% and 50% within the first eight months of 2026.
Mutual funds are generally considered informed investors, making decisions based on thorough research and assessments of long-term company fundamentals. While their buying activity can boost confidence, a consistent reduction in their holdings often signals a change in outlook.
Among the stocks that have seen substantial price drops alongside reduced mutual fund interest is KPIT Technologies. The company’s share price has fallen by 50% in 2026, from Rs 1,174 to Rs 587. Mutual fund holdings in KPIT Technologies decreased to 11.91% in June 2026, down from 12.09% in March 2026 and 13.26% in December 2025.
Alok Industries has also faced a significant downturn, with its stock price dropping 47% in 2026, from Rs 16 to Rs 8.10. Mutual fund holdings declined to 0.07% in June 2026, from 0.08% in March 2026 and 0.13% in December 2025.
Procter & Gamble Hygiene and Health Care’s stock has fallen 38% in 2026, from Rs 12,939 to Rs 7,988. Mutual fund holdings reduced to 8.00% in June 2026, compared to 8.65% in March 2026 and 8.81% in December 2025.
Newgen Software Technologies experienced a 37% decline in its stock price in 2026, moving from Rs 844 to Rs 529. Fund holdings decreased to 2.71% in June 2026 from 3.33% in March 2026 and 4.12% in December 2025.
Patanjali Foods also saw its stock price fall 37% in 2026, from Rs 546 to Rs 345. Mutual fund stakes reduced to 1.27% in June 2026, from 2.25% in March 2026 and 3.32% in December 2025.
Other companies that have seen their share prices drop and mutual fund holdings reduced include Lemon Tree Hotels (down 33%), Birlasoft (down 33%), Tata Elxsi (down 32%), Wipro (down 31%), Jyothy Labs (down 28%), Bata India (down 28%), LTM (down 25%), EIH (down 23%), and Rashtriya Chemicals and Fertilizers (down 22%).
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