Indian markets have maintained a steady upward trajectory, showing remarkable resilience over the past decade. Despite facing challenges such as the COVID-19 pandemic and significant foreign investor outflows, the Sensex and NIFTY 50 have consistently posted positive returns since 2015. Dhruv Goyal, Founder of Four Lion Capital, attributes this strength to strong earnings growth and a flood of domestic capital. However, Goyal warns that rising valuations and potential risks such as slower earnings growth and political instability may dampen future market performance.

“The last time Indian indices saw negative returns in a full calendar year was 2015,” Goyal pointed out. Even in 2020-2021, when India’s economy shrank by -7.3% due to the pandemic, markets remained resilient. “It was quite surprising that the stock market continued to deliver positive returns during one of the worst economic periods in recent history,” he said. In 2022, the market continued its rise, despite foreign portfolio investors (FPIs) pulling out approximately $18 billion as a reaction to aggressive rate hikes by the U.S. Federal Reserve.