Selective Performance of Mutual Funds Masks Underlying Market Volatility

Indian Stock Market Volatility and Mutual Fund Investments

The Indian stock market has experienced significant volatility in recent months, driven by global and domestic uncertainties, including the India-US trade deal and the US-Iran conflict. Both benchmark indices, the BSE Sensex and the Nifty 50, have declined by more than 12% since the start of 2026.

The ongoing geopolitical tensions in the Middle East have further exacerbated market sentiment, with both indices sliding nearly 10% over the past month. Rising crude oil prices and foreign capital outflows have triggered sharp market volatility. However, mutual fund investors have remained relatively insulated from these developments.

Mutual Fund Investments in Inox Wind

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Major mutual fund houses, including Nippon India Mutual Fund and ICICI Prudential Mutual Fund, made significant investments in Inox Wind through a bulk deal on August 8, 2023. The mutual funds acquired large blocks of shares at ₹208, even though the stock is currently trading at ₹78.

Despite the share price fall, the mutual funds are still sitting at gains of roughly 48% due to a 3:1 bonus issue executed by Inox Wind in May 2024. The bonus issue effectively quadrupled the number of shares held by these mutual funds, decreasing the buying price to ₹52 per share.

Inox Wind Share Price Trend

The Inox Wind share price has largely remained negative in the near-term, shedding 23% in a month and 36.47% in year-to-date (YTD) terms. However, the stock has proven to be a multibagger, delivering 217% in three years and 363.48% in five years.

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