India’s retail investors turned selective in the March quarter, funnelling money into a narrow set of large-cap banking, metals, energy and technology stocks even as broader market participation weakened amid persistent volatility.
A Mint analysis of shareholding data for 4,489 BSE-listed companies showed that only about a quarter of listed firms witnessed a rise in retail investor participation during Q4FY26, while nearly 70% saw a decline in retail ownership.
Among the biggest beneficiaries were private sector lender HDFC Bank Ltd and state-run miner Hindustan Copper Ltd, which together added nearly 1.1 million new retail investors between December and March quarters.
Individuals holding nominal share capital up to ₹2 lakh are categorized as retail investors.
“The rise in retail holdings in large-cap stocks such as HDFC Bank, Reliance Industries and Hindustan Copper reflects that retail investors have become more selective and defensive, with a clear preference for fundamentally strong companies offering stable earnings growth and healthy balance sheets,” said Naveen Vyas, senior vice president, Anand Rathi Global Finance.
“This shift suggests a safety-first approach, as many retail investors have seen wealth erosion over the last 12-18 months through exposure to high-beta small-cap and micro-cap stocks.”
Investor influx
HDFC Bank emerged as the biggest retail favourite during the quarter, adding 570,540 individual investors and taking its retail shareholder base to 4.1 million. The increase marked the highest addition recorded by the company since Q4FY24.
The surge also reflected a sharp reversal from the December quarter, when the lender saw a net decline of nearly 48,172 retail investors.
The renewed interest came despite the stock remaining under pressure. HDFC Bank shares have declined about 23% year-to-date, compared with an 11% fall in the Sensex. The lender currently trades at around 15.4 times earnings, with valuations easing further to nearly 14 times FY27 estimates and 12x FY28, according to Bloomberg estimates.
A recent report by Anand Rathi highlighted that the bank’s March quarter performance showed improving trends in deposit growth, margins and asset quality, although loan growth continued to lag the broader industry. The brokerage recently upgraded the stock to “buy”, citing improved risk-reward after the correction.
Retail investors also accumulated other banking names during the quarter. Public sector lender State Bank of India added 176,452 individual investors in Q4FY26, bringing its retail investor base to 3.63 million.
Metal momentum
Hindustan Copper also witnessed one of its strongest retail participation phases in the March quarter. The miner added 482,390 individual investors, taking its retail shareholder base to 1.3 million.
This marked the company’s biggest quarterly increase since Q3FY19. The momentum had already begun in the previous quarter, when the stock added nearly 203,000 retail investors.
The stock has gained about 11% year-to-date, sharply outperforming the benchmark Sensex, which has declined around 11% over the same period.
According to Anand Rathi's report, the company remains well-positioned to benefit from India’s long-term copper demand and domestic mining expansion, though higher freight costs linked to crude oil prices may weigh on near-term profitability. The brokerage also highlighted the commissioning of the Kendadih mine and the grant of a new mining block at Baghwari-Khirkhori as long-term growth drivers.
Consumer giant ITC also remained firmly on retail investors’ radar, adding 425,197 individual investors during the March quarter, reversing a decline of nearly 57,982 investors in the previous quarter. Its retail investor base rose to 3.9 million.
Meanwhile, oil-to-telecom conglomerate Reliance Industries added 204,923 retail investors during the quarter, taking its investor base to 4.2 million.
Engineering and infrastructure major Larsen & Toubro added 161,882 retail investors, while IT services firm Wipro attracted 157,427 new individual shareholders during Q4FY26.
“Q4FY26 shareholding trends suggest retail investors are becoming more selective rather than exiting equities. The rise in investor additions in HDFC Bank, Reliance Industries and Hindustan Copper shows preference for sector leaders, balance-sheet strength and themes such as banking, infrastructure, copper and energy transition,” said Harshal Dasani, business head at INVasset PMS.
“The growing interest in banking, infrastructure, energy and copper sectors reflects increasing maturity among retail investors, who are now aligning investments with long-term growth and capex-driven themes supported by government policy and stronger earnings visibility,” Vyas said.