India’s information technology sector has witnessed a sharp correction, leading to a massive erosion of over Rs 50,000 crore from mutual fund portfolios. According to data sourced from ACE Equities, the decline in IT stocks during the month has significantly impacted fund holdings, with several frontline companies posting double-digit losses.
The data compares mutual fund holdings as of January with the value of holdings as of February so far, highlighting the notional losses and the percentage impact on overall equity assets under management (AUM). The stock returns month-to-date (MTD) further reflect the pressure across the IT pack.
Infosys
Mutual funds held 83.2 crore shares of Infosys as of January, with a market value of Rs 1,36,534.4 crore. As of February so far, the value of these holdings declined to Rs 1,13,945.1 crore, resulting in a notional loss of Rs 22,589.3 crore. Infosys accounts for 2.7 percent of equity AUM. The stock has delivered a negative return of 16.6 percent MTD.
TCS
For TCS, mutual funds held 19.9 crore shares in January, valued at Rs 62,269.6 crore. The February holding value stands at Rs 53,663.4 crore, translating into a notional loss of Rs 8,606.2 crore. TCS represents 1.2 percent of equity AUM. The stock is down 13.8 percent MTD.
HCL Tech
HCL Tech saw mutual fund holdings of 24.1 crore shares worth Rs 40,885.2 crore in January. The value has fallen to Rs 35,082.5 crore in February so far, leading to a notional loss of Rs 5,802.7 crore. The stock constitutes 0.8 percent of equity AUM and has declined 14.2 percent MTD.
Tech Mahindra
Mutual funds held 18.8 crore shares of Tech Mahindra valued at Rs 32,850.7 crore in January. The value has dropped to Rs 28,933.5 crore in February, resulting in a notional loss of Rs 3,917.2 crore. It accounts for 0.6 percent of equity AUM and has fallen 12.0 percent MTD.
Persistent Systems
Persistent Systems had mutual fund holdings of 3.6 crore shares worth Rs 21,564.2 crore in January. The February value stands at Rs 19,568.5 crore, indicating a notional loss of Rs 1,995.6 crore. The stock makes up 0.4 percent of equity AUM and is down 9.2 percent MTD.
Coforge
Coforge saw 12.6 crore shares held by mutual funds, valued at Rs 20,856.8 crore in January. The value has declined to Rs 17,183.7 crore in February so far, resulting in a notional loss of Rs 3,673.1 crore. It represents 0.4 percent of equity AUM and has slipped 17.7 percent MTD.
Mphasis
Mphasis had 5.7 crore shares held by mutual funds, valued at Rs 15,820.1 crore in January. The February value stands at Rs 14,081.0 crore, with a notional loss of Rs 1,739.1 crore. The stock accounts for 0.3 percent of equity AUM and is down 10.9 percent MTD.
Wipro
Mutual funds held 54.0 crore shares of Wipro worth Rs 12,784.8 crore in January. The value has declined to Rs 11,554.4 crore in February, leading to a notional loss of Rs 1,230.5 crore. Wipro forms 0.2 percent of equity AUM and has fallen 9.6 percent MTD.
LTIMindtree
LTIMindtree had 1.4 crore shares held by mutual funds with a market value of Rs 8,172.8 crore in January. The February value has dropped to Rs 6,997.4 crore, resulting in a notional loss of Rs 1,175.4 crore. The stock accounts for 0.2 percent of equity AUM and has declined 14.4 percent MTD.
Hexaware Tech
Hexaware Tech saw mutual fund holdings of 6.9 crore shares valued at Rs 4,820.9 crore in January. The value has slipped to Rs 3,876.9 crore in February so far, causing a notional loss of Rs 944.1 crore. It contributes 0.1 percent to equity AUM and is down 19.5 percent MTD.
Cyient
Cyient had 3.7 crore shares held by mutual funds, valued at Rs 4,217.9 crore in January. The February value stands at Rs 3,689.2 crore, reflecting a notional loss of Rs 528.7 crore. The stock accounts for 0.1 percent of equity AUM and has declined 12.6 percent MTD.
KPIT Tech
Mutual funds held 3.7 crore shares of KPIT Tech worth Rs 3,904.3 crore in January. The value has dropped to Rs 3,228.5 crore in February, resulting in a notional loss of Rs 675.8 crore. It forms 0.1 percent of equity AUM and has fallen 17.3 percent MTD.
OFSS
OFSS had 0.5 crore shares held by mutual funds valued at Rs 3,861.2 crore in January. The February value has decreased to Rs 3,304.8 crore, translating into a notional loss of Rs 556.4 crore. The stock accounts for 0.1 percent of equity AUM and is down 14.5 percent MTD.
Overall Impact
The combined notional losses across these major IT stocks exceed Rs 50,000 crore, underscoring the severity of the correction in the sector. Heavyweights like Infosys and TCS alone contributed a significant portion of the erosion. The sharp month-to-date declines across companies, ranging from around 9 percent to nearly 20 percent, have weighed heavily on mutual fund portfolios.
With IT stocks forming a meaningful portion of equity AUM, the correction has created short-term pressure on fund performance. Investors and fund managers will now closely monitor upcoming earnings, management commentary, and global demand trends to assess whether the sector stabilizes in the coming months.
Source: ACE Equities
Disclaimer:The information provided in this article is for educational and informational purposes only and should not be construed as investment advice. Stock market investments are subject to market risks. Readers are advised to consult their financial advisor before making any investment decisions. The data mentioned is based on publicly available sources and mutual fund holding disclosures as referenced in the report.
