The first two months of 2025 were dreadful for the market, with mid-cap and small-cap indices falling by more than 20%.
The benchmark NSE Nifty also set a record with negative returns for five consecutive months.
This correction is the most brutal since the 2020 pandemic, which has hit the broader market more heavily than the benchmark indices.
Consequently, most stocks have fallen sharply from their respective 52-week highs in a short period. As such, investors are tempted to buy on dips to make fresh investments or average up the prices of stocks they already own.
However, not every stock is worth buying on dips, as there is uncertainty about how low the price will go. Most of the time, only stocks with strong fundamentals and earnings prospects recover, while others languish.
Therefore, it is essential to know that some stocks may not be worth considering, even if the stock price has fallen 40-50% from the top.
This article highlights five such companies.
#1 Sterling & Wilson Renewable Energy
First on the list is Sterling & Wilson Renewable Energy.
Sterling & Wilson is a leading end-to-end renewable energy EPC solutions provider with a presence in 28 countries, including India, South-East Asia, the Middle East, Africa, and Europe.
The company provides EPC services for utility-scale solar, floating solar, hybrid, and energy storage solutions and has a total portfolio of 21.7 Gigawatts peak (GWp).
Moreover, it also manages an operations and maintenance (O&M) portfolio of 8.8 GWp solar power projects.
The company’s financial position is very bad. Profit and revenue growth are inconsistent. It has been a loss-making company in the last four financial years ending FY24.
While it turned profitable in FY25, with consistent profits in all three quarters, its sustainability is still to be seen.
The company faces several other issues as well.
The biggest concern is the ongoing selling by the company’s promoters, who have sold 7.25% of their stake in the last four quarters ending December 2024.
From June 2023, the selling has become more intense as they have sold 23.7% stake.
In addition, the company has recently seen several senior leadership resignations, raising another concern among shareholders.
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