5 most-sold small-cap stocks by mutual funds in May 2025

Bonus: Want to know which small-cap stocks mutual funds bought more of? Scroll to the end of the story to find out.

Last updated: 17-Jun-2025•Ujjal Das and Aditya Gupta

5-most-sold-small-cap-stocks-mutual-funds-may-2025 Sakshi/AI-Generated Image

May 2025 wasn’t just about fresh bets—mutual funds also pared exposure to a few small-cap stocks.

Whether due to profit booking, changing conviction or concerns over near-term outlook, some stocks saw meaningful exits. And the list cuts across sectors—from real estate to fertilisers and financials.

Here are the five small-cap stocks where mutual fund holding dropped the most in May 2025.

Company	Stock Rating	Mutual fund stake % (May 2025)	Mutual fund stake % (April 2025)	Change (% points)
Mahindra Lifespace Developers	★	11.0	16.8	-5.8
Utkarsh Small Finance Bank	★★★	1.0	4.3	-3.3
Heubach Colorants India	★★★★	2.2	4.6	-2.4
Paradeep Phosphates	★★★	18.5	20.7	-2.2
CarTrade Tech	★★★	10.0	11.8	-1.8

Mahindra Lifespace Developers

Mahindra Lifespace Developers is the real estate arm of the Mahindra Group, operating across two segments—residential projects and integrated industrial clusters. Its key markets include the Mumbai Metropolitan Region (MMR), Pune and Bengaluru.

In FY25, it reported residential sales of Rs 2,804 crore and Rs 495 crore from the industrial business. The company has 1,634 acres of land available for future leasing. All revenues are generated from domestic operations.

P/E	5Y revenue	5Y net profit	Return on equity	Return on capital employed
124	-9.43 per cent	34.33 per cent	5.4 per cent	2.6 per cent

Utkarsh Small Finance Bank

Utkarsh SFB is a scheduled commercial bank with a strong focus on financial inclusion, primarily serving rural and semi-urban areas. Its lending portfolio is led by micro-banking loans (49 per cent), followed by MSME loans (20 per cent), wholesale lending (11 per cent) and housing and vehicle loans.

As of March 2025, the bank operated 1,092 outlets across 27 states, with 88 per cent of micro-banking branches in less urbanised regions.

P/B	Net interest margin	Return on assets	Return on equity	Net NPAs
0.9	7.8 per cent	1.7 per cent	15.47 per cent	0.85 per cent

Heubach Colorants India

Heubach Colorants India, based in Navi Mumbai, manufactures organic and inorganic pigments, pigment preparations and dyes. Its products cater to industries like coatings, plastics, printing and personal care.

Holding around 20 per cent market share in India, the company reported revenue of Rs 799.4 crore in FY24. Its Roha and Cuddalore plants run on 84 per cent and 55 per cent renewable energy, respectively.

P/E	5Y revenue	5Y net profit	Return on equity	Return on capital employed
29	0.94 per cent	14.55 per cent	9.1 per cent	12.9 per cent

Paradeep Phosphates

Paradeep Phosphates is India’s second-largest private phosphatic fertiliser maker with a total capacity of 3.0 million tonnes per annum. It operates two plants—one in Paradeep, Odisha and another in Goa—producing DAP, NPK fertilisers and urea.

In FY24, PPL produced 2.3 million tonnes and sold 2.5 million tonnes of finished fertilisers. Sales are entirely domestic, spread across 15 Indian states, with NPK fertilisers making up the bulk of volumes.

P/E	5Y revenue	5Y net profit	Return on equity	Return on capital employed
25	21.58 per cent	-8.87 per cent	2.8 per cent	6.5 per cent

CarTrade Tech

CarTrade Tech runs a digital marketplace for buying and selling new and used vehicles. Its business is split across three key segments: the Consumer Group (CarWale, BikeWale), the Remarketing segment (vehicle auctions via Shriram Automall) and Classifieds (OLX India). Each segment contributes roughly a third to revenue. In FY24, the company reported Rs 555 crore in revenue and facilitated over 12 lakh vehicle auctions.

P/E	5Y revenue	5Y net profit	Return on equity	Return on capital employed
57.7	15.03 per cent	23.77 per cent	4.5 per cent	5.3 per cent

Similarly, do you want to know which small-cap stocks mutual funds bought more of in May 2025? Head over to our article 5 most-bought small-cap stocks by mutual funds in May 2025. Have fun!

Also read: 5 high-quality small caps that are available at a good price

Disclaimer: This content is for information only and should not be considered investment advice or a recommendation.

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