Why Are So Many Mainboard Stocks Down Over 50% And What Should Investors Learn From These Crashes?
A long list of popular mainboard names has fallen sharply — many by 50–78% from their 52-week highs. This is not a small-cap-only phenomenon. Some were once market darlings, others winners of short-term liquidity spikes, and several were part of thematic run-ups that later fizzled as earnings and cash-flow realities caught up.
When a broad basket of stocks shows such deep drawdowns, it signals exhaustion of froth, sentiment reversal, and cleansing of excess. But it also sets the stage for long-term investors to reassess value, durability, and sector-level resilience through a more sober lens.
Understanding why some stocks fall 50% or more is crucial. It is usually not random. Market corrections of this magnitude reveal: • Where hype ran ahead of fundamentals • Where valuations ignored cash flows • Where promoter issues or governance led to derating • Where cyclical demand collapsed • Where liquidity dried up • Where speculative participation exited abruptly Investors who remain anchored to price-only narratives often get trapped. Those who study business quality, margins, cash cycles, competitive moats and capital allocation frameworks tend to avoid catastrophic falls. And importantly, investors who understand behavioural finance realise that deep corrections are not always signals of doom—sometimes they are the beginning of value discovery.
The Stocks That Have Fallen 50–78% From Their Highs
Stocks down 70–78%:
RS Soft (78%) • Vakrangee (78%) • Ward Wizard Innovations (78%) • DreamFolks (76%) • Rajoo Engineers (76%) • Vishnu Prakash (76%) • EKI Energy (74%) • Pal Drugs (74%) • Gujarat Tool Room (74%) • Blue Cloud (70%) • Fischer Medicals (70%) • Misthan Foods (70%) • Pakka (70%) • Waaree Tech (70%)
Stocks down ~66%:
Mobikwik (66%) • Mercury EV (66%) • Jyoti Structures (66%)
Stocks down 60–65%:
PIGL (65%) • Patel Airtemp (65%) • Tejas Networks (65%) • Easy Trip Planners (62%) • Epack Durables (62%) • Praj Industries (62%) • Cian Agro (60%) • JP Associates (60%) • Kisan Mouldings (60%) • Ola Electric (60%) • Protean E-Gov (60%) • Sterling Tools (60%) • Vedant Fashions (60%)
Stocks down 53–56%:
Cohance Lifescience (56%) • Oriental Rail (56%) • Quadrant Fut Tech (56%) • Sterling & Wilson (56%) • Tarson Products (56%) • EMS (55%) • Genesys Tech (55%) • Route Mobile (55%)
Stocks down 51–54%:
Indotech Transformers (54%) • KNR Constructions (54%) • RMC Switchgears (54%) • Wendt (54%) • TARIL (53%) • Ion Exchange (53%) • Stallions Fluoro (53%) • Likitha Infra (51%) • Raymond Realty (51%) • Raymond Life (51%) • Shakti Pumps (51%)
Stocks down 50%:
IGIL (50%) • Morpen Labs (50%) • Newgen Software (50%) • Shree Ganesh Remedies (50%)
Many of these companies reflect narratives that once had strong investor momentum: EV plays, engineering firms, platform businesses, chemicals, infra, energy transition and digital transformation beneficiaries. But momentum cannot replace fundamentals forever. The 50–78% corrections signal the market’s process of re-rating — from hope to reality.
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What Deep Corrections Reveal About Market Psychology
Markets often follow psychological cycles—optimism → excitement → euphoria → anxiety → denial → fear → capitulation → despair → hope → recovery.
A stock falling 50–78% means it has entered or is entering the capitulation–despair stage. This is where maximum pessimism builds, volumes dry up, media attention fades, and retail exits in panic. Ironically, this is also where some of the greatest multi-bagger stories silently begin forming — not overnight, but through slow business repair.
However, not every stock recovers. The key is distinguishing between:
- Temporary earnings pressure vs permanent business impairment
- Sentiment-driven crashes vs governance-driven erosion
- Market overreaction vs reality catching up
- Sustainable balance sheets vs debt-fuelled narratives
Only companies with improving balance sheets, demonstrating cash-flow discipline, expanding moats and clear execution pathways qualify for revival cycles. The rest often become value traps.
Why Stocks Crash More Than 50% — A Simple Framework
| Reason | Explanation |
|---|---|
| Valuation Excess | Stock ran too fast, too soon — P/E expands without earnings support. |
| Liquidity-Driven Rally | Retail-driven spikes reverse when liquidity dries up. |
| Governance Issues | Auditor resignations, pledging, related-party red flags. |
| Sector Rotation | Money exits themes like EV, chemicals, defense to re-enter banks/IT/FMCG. |
| Weak Cash Flows | Revenue growth without cash flow leads to derating. |
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Investor Takeaway by Derivative Pro & Nifty Expert Gulshan Khera, CFP®
Sharp corrections are not random market tantrums. They are structural signals. A stock that has fallen 60% is telling you something — either about business deterioration or about valuation mean reversion. The job of a serious investor is to decode that message instead of reacting emotionally. Always examine the three pillars: cash flow, leverage and promoter intent. If these three are stable, deep corrections can create multi-year opportunities. If they are weak, even a 70% fall may still be expensive. Build your framework, filter aggressively and act only after clarity emerges.
Related Queries on Deep Stock Corrections
🔹 How to identify genuine value vs value traps after a 50% fall?
🔹 Are some of these beaten-down sectors entering accumulation zones?
🔹 Which risk indicators must be checked before bottom-fishing?
🔹 How can derivatives help in hedging exposure during corrections?
🔹 What macro signals usually precede a bottoming-out phase?
