For most India-linked ADRs trading on US exchanges, the past year proved painful, with the majority handing investors losses rather than gains. The deepest cuts landed on technology counters, where Infosys and Wipro slid into double-digit negative territory. Soft demand for IT services, paired with wobbling investor confidence, kept a steady lid on these prices. The contrast was stark: over the very same stretch, US heavyweights such as Nvidia, Alphabet and Apple all posted positive returns.
IBM's Tumble Deepened the Selling
The pressure to sell intensified after IBM dropped sharply. Following a second quarter that came in worse than the market expected, IBM shares fell 25.5%. That move rippled straight into Indian IT ADRs, which saw a rapid sell-off of their own. The weakness was not confined to technology either. HDFC Bank and ICICI Bank ADRs also trailed through the year, leaving banking counters among the laggards.
Six ADRs, and Most Looked Weak
There are six Indian ADRs listed on US markets, spread across technology, banking and pharmaceuticals. For most of these names, the one-year picture stayed weak. Return data for Tata Motors on the NYSE was not available, which kept that counter outside this read of the trend.
Why ADRs Often Trail Domestic Returns
It is common for Indian ADR returns to look worse than the returns booked back home, and there are concrete reasons behind the gap. A weaker rupee shrinks the dollar-denominated results that ADR holders actually receive. Trading hours differ between the two markets, which changes how each one reacts to the same piece of news. On top of that, liquidity varies and investor sentiment can swing from one exchange to another. Together, these forces widen the return gap even when a company's earnings hold steady.
Global Headlines and the Pharma Angle
Some of the swings traced back to sudden global headlines, including chatter about a possible US-Iran deal. Yet over time, despite broadly steady results, many ADR prices kept drifting lower. Within pharma, Dr. Reddy's held up better than the IT ADRs, though its fourth-quarter earnings still missed estimates.
In India too, Dr. Reddy's shares softened after supply and recall-related developments. Because of an API issue, the company temporarily paused commercial supplies of generic semaglutide. Separately, Torrent Pharmaceuticals voluntarily recalled select batches of Semalix injection pens that were manufactured by Dr. Reddy's.
A Widening Gap Between Wall Street and Dalal Street
Tata Motors emerged as a positive performer within India, even as its ADR visibility remained limited. On the whole, Wall Street baked more uncertainty and sector pressure into Indian ADRs. Dalal Street, by contrast, sent more mixed signals, supported by currency moves and the conviction of local investors. The upshot was a clearer divide between the US listings and the domestic outcomes.
