Over the past five years, as of August 15, 2024, the Nifty 50 Index has delivered a remarkable return of 118%, translating into a compound annual growth rate (CAGR) of 16.93%. This performance reflects the robust returns that Indian equity markets have provided to investors.

However, not all investors have benefited equally from this growth. Many long-term holders of specific large-cap Nifty 50 stocks have experienced significantly lower returns, in some cases earning less than half of the Index’s gains over the same period.

Below is a list of five Nifty 50 companies that have underperformed the Index. Investors might consider these stocks as potential value picks:

1. IndusInd Bank Ltd

• Current Price: ₹1,338
• Market Cap: ₹1,04,249 crore
• 5-Year Return: -6.68%
• About the Company: IndusInd Bank Limited (IBL) offers a diverse range of banking products and services to 34 million individuals, non-resident Indians (NRIs), business owners, corporates, and government and financial institutions across India, including rural markets. The bank operates internationally in London, Dubai, and Abu Dhabi. Established in 1994 and headquartered in Mumbai, IndusInd Bank is currently the ninth-largest bank in India by market capitalization. It operates through a network of 2,606 branches and 2,878 ATMs, serving a customer base of 34 million.

2. Kotak Mahindra Bank

• Current Price: ₹1,749
• Market Cap: ₹3,47,523 crore
• 5-Year Return: 16.68%
• About the Company: Kotak Mahindra Bank Limited (KMB) provides a comprehensive suite of banking and financial services to both corporate and individual customers across India. Established in 1985 and headquartered in Mumbai, Kotak Mahindra Bank is the fifty-largest bank in India by market capitalization.

3. HDFC Life Insurance Company

• Current Price: ₹686
• Market Cap: ₹1,47,578 crore
• 5-Year Return: 26.95%
• About the Company: HDFC Life Insurance Company Limited is a leading provider of long-term life insurance solutions in India. It was formed as a joint venture between Housing Development Finance Corporation Limited (HDFC Ltd) and Abrdn plc (formerly Standard Life Aberdeen plc). Established in 2000, the company offers a range of individual and group insurance products, including protection, pension, savings, investment, annuity, and health solutions.

4. Hindustan Unilever Ltd (HUL)

• Current Price: ₹2,722
• Market Cap: ₹6,40,052 crore
• 5-Year Return: 48.81%
• About the Company: Hindustan Unilever Limited (HUL), headquartered in Mumbai, is a leading fast-moving consumer goods (FMCG) company owned by Unilever Plc. With a history spanning 90 years, HUL markets a wide range of products, including beauty and personal care items, home care products, and packaged foods and beverages. Its portfolio includes soaps, skincare products, detergents, water purifiers, nutrition drinks, and frozen desserts, among others.

You can read a detailed stock research report on Hindustan Unilever published on Trade Brains Portal.

5. HDFC Bank

• Current Price: ₹1,697
• Market Cap: ₹12,24,816 crore
• 5-Year Return: 44.35%
• About the Company: HDFC Bank, a subsidiary of Housing Development Finance Corporation Limited (HDFC Ltd), was one of the first financial institutions in India to receive approval from the Reserve Bank of India (RBI) to establish a private sector bank. Founded in 1994, the bank has grown to serve over 93.2 million customers and has a global presence with offices and branches in Bahrain, Hong Kong, the UAE, Kenya, London, and Singapore.

Evaluating a company’s performance relative to the Index can be a valuable tool for investors. Stocks that underperform the Index, but have strong fundamentals, may present opportunities for value investors seeking to capitalize on lower valuations and stock prices.

Kritesh (Tweet here) is the Founder & CEO of Trade Brains & FinGrad. He is an NSE Certified Equity Fundamental Analyst with +7 Years of Experience in Share Market Investing. Kritesh frequently writes about Share Market Investing and IPOs and publishes his personal insights on the market.