HDFC Bank, TCS, Asian Paints among 7 NIFTY50 stocks with 0% return in last five years

HDFC Bank, TCS, HUL, Infosys and several other NIFTY50 heavyweight stocks have underperformed and delivered 0% return to investors over the five year period.

The weakness is notable across several sectors and not just confined to one particular sector. For instance, the entire IT sector has witnessed slowdown for the past several years with IT major TCS being the biggest laggards with five-year return of negative 36%.

Several of these large cap stocks carry substantial higher index weightage. HDFC Bank has a total weight of 10.2% in NIFTY50 index as of July 31, 2026. Meanwhile, the IT sector has a weightage of 8.37%. Despite underperformance of heavyweight stocks, the NIFTY50 index has delivered a positive return of over 50% in last five years as strong performance of other financial stocks, metal and telecom sector has offset weakness in individual heavyweights.

IT pack underperform amid AI disruption

Most obvious laggards from the NIFTY50 index are the IT stocks. TCS, Infosys, Wipro and other major IT stocks have given negative returns over the last three and five year period. IT stocks have largely remained on weak footing after the COVID rally.

Indian IT stocks have underperformed due to multiple reasons like fears of artificial intelligence (AI) disruption. AI agents and coding tools are challenging the traditional IT outsourcing business model. As per experts, AI is expected to displace 9% to 12% of total IT service revenue in next 3 to 4 years as new IT deals are moving away from traditional human-hour billing to outcome-based revenue models.

Besides AI disruption, slowdown in global IT spendings in post-COVID era and weak guidance and earnings have also impacted the IT stocks. Foreign institutional investors reducing their exposure to traditional IT service stocks to niche segments like semiconductor and AI infrastructure has also created selling pressure on IT stocks.

HDFC Bank faces margin pressure and FIIs outflow

India’s largest private sector lender, HDFC Bank has given negative returns of 7.6% and 6.4% in the last 3-year and 5-year period. HDFC Bank stock hit a 52-week low of ₹715.1 apiece 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.

HDFC Bank is facing a major challenge to integrate its operations and loan book after its mega merger with HDFC Ltd in July 2023. The merger with HDFC Ltd gave a much larger mortgage portfolio and balance sheet. As a result, 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.

Besides this, HDFC Bank has faced governance concerns in recent months after former chairman Atanu Chakraborty resigned in March 2026, saying certain practices at the bank were not consistent with his personal values and ethics. Besides this, around ₹45 crore deposits linked to MSRDC had been routed through HDFC Bank's marketing budget which raised investors' concerns. However, RBI review and internal review by the bank found no material governance or conduct-related concern at HDFC Bank.

FIIs outflow in HDFC Bank stock has also increased in recent quarters. As per HDFC Bank's shareholding pattern, FIIs' holding in the bank reduced to 41.82% at the end of the June 2026 quarter from 44.05% at the end of the March 2026 quarter. In the June quarter of FY26, FII holdings in HDFC Bank stood at 48.84%.

Hindustan Unilever on weak footing

FMCG major Hindustan Unilever (HUL) hit a 52-week low of ₹2,006.2 apiece on NSE on August 24. HUL shares have delivered negative returns of over 20% on a 3-year and 5-year basis as weak earnings, surge in raw material prices and sluggish volume growth has impacted the investor sentiments.

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. Q1 profitability and volume growth missed the market expectations as elevated prices for palm oil, crude derivatives and other raw materials has led to lower EBITDA margins.

HUL volume growth has faced several challenges amid slow recovery in rural demand and mass skincare category, rising competition in the entry-level segment.

Rising competition and input costs weigh on Asian Paints

India’s top paint brand Asian Paints has been losing its shine in recent years as shares have delivered negative returns and underperformed in the last five years. Intense competition, surge in crude oil prices and historical high valuations has led to correction in the Asian Paints stock.

Paint industry has seen disruption in recent years with the entry of deep-pocketed new companies like Grasim’s Birla Opus, JSW Paints which acquired a majority stake in Akzo Nobel India and renamed the company as JSW Dulux Limited in March 2026. Birla Opus has already reached 10% market share in the organised decorative paint segment and currently has the 2nd largest capacity. This has created intense competition for Asian Paints.

Volatile crude oil prices directly impact Asian Paints operating profit margins as crude derivatives make up over half of their input materials and price increase cannot be passed immediately to buyers.

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