There are quite a few reasons why these stocks have corrected. Here are some of the major reasons for the same.

· All the three stocks mentioned above were quoting at extremely premium valuations and were at the higher percentile of valuations compared to the industry average. That was anyways making them vulnerable.

· The recent FPI tax issue had a small googly to it. The IT department has confirmed that FPIs structured trusts will have to pay the higher surcharge for the Apr-Jun quarter and that would mean they have to pay higher advance tax. The only way they will be able to do that would be to unwind futures of these highly liquid counters. That also led to some worries.

· One more worry was the HDFC Bank results. While HDFC Bank NPAs continued to be under control, they have given the guidance that stress on retail books could be visible in the coming quarters. This led to some fear in the market about the future of such stocks and that also impacted the stock prices.

· Consumption slowdown took its toll on prices. In fact, Sanjiv Bajaj of Bajaj Finance had warned ahead of the results that consumption slowdown could bring demand stress and also risk of NPAs at the retail end. This consumption overhang also played its part in depressing these prices.

· Last, but not the least, there is the rate cut issue. Till the end of last week, financial markets were betting on a 50 bps rate cut by the Fed and the RBI. Now, warnings from the Boston Fed and the RBI governor have underlined that this could at best be 25 bps. That would reduce the credit off take and the ability of these companies to transmit the rate cuts.

These are still high quality companies but the valuation froth needs to go down. You must wait till there is greater clarity on the consumption front.