Income Tax Department Launches Self-Help Tool for New Tax Bill 2025

The Income Tax Department has introduced an online self-help tool to assist taxpayers in understanding the proposed changes in the Income Tax Bill 2025. Available on the official income tax website, this tool allows users to compare provisions of the new bill with the existing Income Tax Act, of 1961, offering a structured and simplified approach to navigating tax reforms.

How to Use the Self-Help Tool?

  1. Visit the Official Website – Access the tool on the Income Tax Department’s official website.
  2. Navigate to the Comparison Section – Locate the tool that allows comparison between the Income Tax Act, 1961, and the Income Tax Bill 2025.
  3. Select a Section – Use the dropdown menu to choose a specific section from the existing Income Tax Act, 1961.
  4. View the Comparison – The corresponding clause from the Income Tax Bill 2025 will be displayed on the right-hand side for direct comparison.
  5. Use the Structured Table Format – For better clarity, taxpayers can opt for a structured table view, making it easier to understand the changes.
  6. Repeat for Other Sections – Users can continue selecting different sections to compare multiple provisions as needed.

Key Features of the Income Tax Bill 2025

The Income Tax Bill 2025 is set to replace the 64-year-old Income Tax Act, 1961, significantly reducing its complexity. The word count has been cut from 5.12 lakh to 2.6 lakh, while the number of chapters has decreased from 47 to 23 and sections from 819 to 536.

To simplify tax calculations, the number of tables has increased from 18 to 57, and 900 explanations and 1,200 provisos that previously complicated tax rules have been removed. Additionally, the bill introduces the term “tax year”, replacing the existing concepts of “assessment year” and “previous year”. The use of clearer, more concise language makes the new bill easier for taxpayers to understand.

Conclusion

The Income Tax Bill 2025 marks a significant shift in tax legislation by simplifying the existing framework. With the introduction of a self-help tool, taxpayers can efficiently compare provisions and adapt to the new system. This initiative ensures greater clarity and accessibility, aiding in a smoother transition to the revised tax structure.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Lemon Tree Hotels Expands With a New Property in Shirdi, Maharashtra

Lemon Tree Hotels has signed a license agreement to open a new property in Shirdi, Maharashtra. Carnation Hotels Private Limited, a wholly-owned subsidiary of Lemon Tree Hotels, will operate the hotel, which is expected to start functioning in the financial year 2028.

Hotel Facilities and Location

The new Hotel will offer 50 well-furnished rooms along with a restaurant, banquet hall, meeting room, swimming pool, spa and other public areas for guests’ convenience. It is located in the well-known pilgrimage town of Shirdi, making travel easy. The hotel is 14.8 km from Shirdi International Airport and just 3 km from Sainagar Shirdi Railway Station. It is also well connected by road for convenient access.

Lemon Tree’s Expansion Strategy

Regarding the signing of the new hotel in Shirdi, Mr Vilas Pawar, CEO-Managed & Franchise Business, at Lemon Tree Hotels, commented, “We are delighted to expand our portfolio in Maharashtra, one of India’s largest commercial and industrial hubs. By expanding in the state, we are not only tapping into a thriving economic hub but also embracing a place that beautifully balances modernity with tradition. This new addition will complement our 12 existing hotels and six upcoming properties in Maharashtra.”

About Lemon Tree Hotels

Lemon Tree Hotels is among India’s largest hotel chains, catering to different segments from luxury to budget stays. With over 200 properties, including operational and upcoming hotels, it has a presence in major Indian cities and has expanded internationally to Dubai, Bhutan and Nepal.

Share Price Performance 

As of February 27, 2025, at 9:45 AM, the shares of Lemon Tree Hotels Ltd are trading at ₹126.70 per share, reflecting a surge of 0.21% from the previous day’s closing price. Over the past month, the stock has registered a loss of 2.97%. The stock’s 52-week high stands at ₹162.40 per share, while its low is ₹112.29 per share.

Conclusion

With this expansion, Lemon Tree Hotels continues its growth strategy, enhancing its portfolio in Maharashtra while catering to both business and leisure travellers.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Lab Grown Diamonds Changing Dynamics of the Indian Jewellery Market

The Indian jewellery market is undergoing a significant transformation, driven by the rising acceptance of lab-grown diamonds (LGDs) and evolving consumer preferences. Traditionally, gold has been valued both as an investment and a fashion statement, but shifting trends indicate a possible change in consumption patterns. The emergence of LGDs and financial gold instruments could reshape the jewellery industry and influence the overall market structure.

Lab-Grown Diamonds: A Disruptive Trend

Lab-grown diamonds (LGDs) are gaining traction in India as a cost-effective alternative to natural diamonds. While they have already seen widespread acceptance in developed markets, their presence in India is still in its early stages. Their affordability is attracting consumers who seek fashionable yet economical options, making LGDs a growing segment in the jewellery industry.

As LGDs continue to gain popularity, their impact on traditional diamond sales is becoming increasingly evident. Consumers who previously preferred natural diamonds are now exploring LGDs, leading to a potential shift in the overall jewellery purchase mix. This trend could disrupt conventional business models in the jewellery sector, particularly affecting retailers who rely on high-margin natural diamond sales.

Gold: From Jewellery to Investment Asset

Gold has always played a dual role in Indian households, serving as both an adornment and a store of value. However, changing consumer preferences suggest a potential shift towards viewing gold primarily as an investment asset rather than a jewellery choice. Financial gold products, such as ETFs and sovereign gold bonds, are witnessing increased interest, indicating a possible reduction in demand for physical gold jewellery.

This transformation could have macroeconomic implications, particularly for India’s Current Account Deficit (CAD) and Balance of Payments (BoP), given the country’s heavy reliance on gold imports. Jewellery companies may face revenue pressures as consumers opt for alternative gold investment avenues, impacting the overall industry landscape.

Conclusion

The Indian jewellery market is evolving as LGDs gain popularity and consumer preferences shift towards alternative investment options. This transformation could alter the traditional demand for gold jewellery while reshaping business models within the sector. As these trends continue to unfold, the market’s future will be determined by the pace of LGD adoption and changing household savings behaviour.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Retirement Planning with SIP: How ₹15,000 Monthly Investment for Just 5 Years Can Grow into ₹2.10 Crore by Retirement

A Systematic Investment Plan (SIP) is a popular and disciplined approach to investing in mutual funds, particularly for long-term financial goals such as retirement. Given that most individuals earn a fixed monthly income, SIPs allow them to invest small, manageable amounts regularly, benefiting from rupee-cost averaging and the power of compounding.

While SIPs are commonly associated with long-term investing, even a short investment horizon of just five years can create a sizeable corpus for retirement when left untouched for the long run.

How ₹15,000 Monthly SIP Can Potentially Grow to ₹2.10 Crore

A SIP investment follows a two-phase growth trajectory:

  1. Accumulation Phase: Investing ₹15,000 monthly for 5 years.
  2. Growth Phase: Allowing the accumulated corpus to grow over time without further contributions.

Phase 1: SIP Investment for 5 Years

  • Monthly SIP Contribution: ₹15,000
  • Total Investment Over 5 Years: ₹9,00,000
  • Estimated Capital Gains: ₹3,37,295 (assuming an annualised return of 12%)
  • Total Corpus at the End of 5 Years: ₹12,37,295

This calculation has been derived from using the SIP calculator. 

At this point, no further investments are made, and the accumulated corpus is left to grow through compounding for the next 25 years.

 

Phase 2: Growth Over 25 Years Without Additional Investment

Once the SIP contributions stop, the accumulated corpus continues to grow at an assumed 12% annualised return:

  • Estimated Capital Gains Over 25 Years: ₹1,97,96,800
  • Total Corpus at Age 60: ₹2,10,34,095 (approximately ₹2.10 crore)

This demonstrates how an initial 5-year investment can yield significant long-term returns through the power of compounding.

What Happens If One Continues SIP for 25 More Years?

For investors willing to extend their SIP investment beyond 5 years, the corpus can grow exponentially. If the ₹15,000 SIP is continued for 25 more years in addition to the 5 years at the same assumed growth rate:

  • Total Investment Over 30 Years: ₹54,00,000
  • Estimated Capital Gains: ₹4,75,48,707
  • Total Corpus at Age 60: ₹ 5,29,48,707 (approximately ₹5.29 crore)

This comparison highlights the impact of compounding and disciplined investing over an extended period.

Conclusion

Systematic investing, even for a short period, can create a substantial corpus if left untouched to grow. Whether investing for 5 years or continuing for 30, the power of compounding plays a crucial role in wealth creation. Understanding this mechanism can help individuals make informed financial decisions to secure their retirement.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Mutual Fund investments in the securities market are subject to market risks, read all the related documents carefully before investing.

45% of Indians Under 35 Prefer Stocks as Their Primary Investment

The investment landscape in India is evolving, with young investors increasingly favouring the stock market. The latest Investor Behaviour Index (IBI 2025) reveals that 81% of respondents have invested in stocks, with nearly 45% of individuals under 35 considering equities their primary investment avenue. This shift is largely attributed to greater financial awareness, improved access to investment platforms, and a preference for long-term wealth creation.

Challenges Hindering Stock Market Participation

Despite this growing enthusiasm, a significant portion of the population remains hesitant about stock market investments. The survey highlights that:

  • 42% of non-investors cite a lack of financial knowledge as their primary barrier.
  • 44% of aspiring investors seek structured, step-by-step guidance to start their investment journey.
  • 38% prefer short, online video courses, indicating a rising demand for concise and accessible financial education.

The Role of Digital Platforms in Investment Growth

Technology is playing a crucial role in simplifying stock market access. The survey notes that 68% of respondents rely on digital platforms for both investing and financial learning. The increasing adoption of AI-powered insights, real-time market data, and virtual trading tools has reduced barriers for new investors. Notably, 49.6% of first-time investors practised using virtual money before making real investments, reflecting a cautious yet progressive approach.

Gender Disparity in Stock Market Participation

Despite rising interest, a significant gender gap persists in equity investing. Only 10.1% of investors surveyed were women, although 34% expressed plans to increase their equity exposure in the coming year. This highlights the need for targeted financial literacy initiatives aimed at bridging the gender divide in investment participation.

Market Concerns and Investor Sentiment

While young investors are increasingly drawn to equities, market volatility remains a concern. The survey found that:

  • 51% of respondents fear potential market crashes, indicating risk aversion among investors.
  • 41% of non-investors stated that free initial guidance would encourage them to start investing, suggesting the need for better educational resources and advisory services.

Financial Inclusion Beyond Metros

The survey also sheds light on the expansion of stock market participation beyond metropolitan cities. 40% of respondents were from tier-II and tier-III cities, reflecting deeper financial inclusion and growing awareness across different regions. The increasing accessibility of investment platforms and structured financial education has played a pivotal role in bridging this urban-rural divide.

Conclusion: The Need for Continuous Financial Education

The findings of the IBI 2025 survey indicate a paradigm shift in investment preferences among young Indians, driven by technology, education, and a desire for long-term wealth creation. However, financial literacy remains a key challenge, necessitating structured education, accessible resources, and advisory services to sustain this momentum. As digital platforms continue to evolve, fostering financial awareness will be crucial in shaping the future of India’s investment landscape.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Indian Railways to Achieve 100% Electrification by FY26; ₹1.04 Lakh Crore Investment Underway

The Indian Railways is set to achieve 100% electrification by the financial year 2026 (FY26), reinforcing its commitment to sustainability. Union Minister of Railways, Mr Ashwini Vaishnaw, made this announcement at the Madhya Pradesh Global Investors Summit (GIS) 2025. He confirmed that over 97% of the electrification has already been completed, with the remaining work scheduled for completion within the next fiscal year.

This milestone is part of the government’s broader objective to make the Indian Railways a net-zero carbon emitter by 2030. The initiative is a key step towards reducing dependence on fossil fuels and integrating renewable energy into railway operations.

Railways Expanding Renewable Energy Portfolio

As part of its sustainability drive, Indian Railways is significantly investing in renewable energy. The minister revealed that the railway network has secured a renewable energy capacity of 1,500 MW (1.5 GW). The latest addition to this portfolio is a 170 MW power purchase agreement signed with Madhya Pradesh.

This agreement involves collaboration between the Indian Railways, Waree Energies, and Rewa Ultra Mega Solar Ltd (RUMSL). Mr Vaishnaw assured that Railways is prepared to procure all stable renewable energy supplies from Madhya Pradesh and expressed interest in wind and nuclear power projects if the state develops such initiatives. Furthermore, he indicated a willingness to sign similar agreements with other states to enhance energy sustainability.

Record ₹14,745 Crore Railway Budget for Madhya Pradesh

Highlighting the government’s commitment to infrastructure development, Mr Vaishnaw announced that Madhya Pradesh has received a record railway budget of ₹14,745 crore (US$1.70 billion) for FY26. This substantial allocation marks a significant increase in railway funding and development initiatives in the state.

Before 2014, the annual railway line construction in Madhya Pradesh was limited to 29.3 km. However, in recent years, this figure has surged to 223 km per year—an impressive 7.5-fold increase. The funding for railway projects has also expanded 23 times, enabling faster and more extensive railway network expansion.

₹1.04 Lakh Crore Investment in Railway Projects

The Union Minister provided an update on ongoing and newly sanctioned railway projects in Madhya Pradesh. He revealed that railway projects worth ₹1,04,000 crore (US$12 billion) are currently underway in the state. These investments encompass track expansion, electrification, and modernisation efforts aimed at improving efficiency, reducing transit times, and boosting overall railway connectivity.

Conclusion

With these initiatives, Indian Railways is progressing towards a more sustainable and energy-efficient future, aligning with the nation’s broader environmental and economic goals.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Top 7 Key Changes in RBI’s Latest Microfinance Loan Regulations

The Reserve Bank of India (RBI) has introduced significant changes in the classification and risk weighting of microfinance loans, aiming to boost credit flow and enhance financial stability. The revised guidelines allow certain microfinance loans to be classified under the Regulatory Retail Portfolio (RRP) if they meet specific criteria. This change is expected to benefit both lenders and borrowers by reducing capital requirements for banks and increasing lending capacity.

What is Risk Weight?

Risk weight determines the amount of capital that banks must maintain as a safeguard against potential defaults on loans. A higher risk weight means banks must set aside more capital, limiting their ability to extend credit. Conversely, a lower risk weight allows banks to lend more freely, stimulating economic growth.

Top 7 Key Changes Introduced by RBI

1. Revised Risk Weight Norms

Previously, consumer microfinance loans were subject to a 125% risk weight, requiring banks to hold significant capital reserves. With the latest revision, RBI has reduced this requirement to 100%, freeing up liquidity for increased lending.

2. Exemption for Certain Microfinance Loans

Microfinance loans that do not fall under the category of consumer credit and meet RBI’s qualifying criteria can now be classified under the Regulatory Retail Portfolio (RRP). This classification allows banks to apply a reduced risk weight of 75%, thereby improving capital efficiency.

3. Impact on NBFCs and Microfinance Institutions

Non-Banking Financial Companies (NBFCs) and microfinance institutions had experienced a lending slowdown since November 2023 due to stricter risk weight regulations. The revised guidelines provide relief, enabling these institutions to enhance credit availability for small borrowers.

4. Differentiation Between Personal and Microfinance Loans

While personal loans continue to attract a higher risk weight, microfinance loans that satisfy RBI’s qualifying criteria will benefit from a lower capital requirement, thus making microfinance lending more viable for banks.

5. Immediate Implementation

As per RBI’s circular, these revised risk weight norms are effective immediately, ensuring a prompt impact on the lending ecosystem.

6. Safeguarding Financial Stability

The new regulations strike a balance between supporting small borrowers and maintaining banking sector stability. By easing capital requirements, RBI aims to encourage financial inclusion while ensuring banks maintain prudent risk management practices.

7. Growth Potential for Microfinance Lending

With lower capital reserves required for microfinance loans, banks and financial institutions are expected to expand their lending activities, further supporting economic development and financial empowerment for lower-income groups.

Conclusion

RBI’s decision to revise risk weights for microfinance loans marks a significant step towards boosting liquidity and credit growth. By allowing certain microfinance loans to qualify for Regulatory Retail Portfolio classification, the central bank aims to enhance financial inclusion while maintaining a stable banking environment. These changes are expected to foster growth in the microfinance sector and provide much-needed relief to lenders and small borrowers alike.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Say Hello to Auto-Save Drawings

Investors and traders know how crucial it is to analyze charts and make informed decisions based on precise data. But what if the tools meant to assist you are unreliable? One of the most frequent pain points for users is the frustration of losing custom drawings on charts after investing time to create them. Whether it’s on web, Android, or iOS, the inconsistency in retaining drawings has been a significant issue—until now.

We’re excited to introduce Auto-Save Drawings, a functionality designed to ensure your chart annotations and customizations persist seamlessly across sessions and platforms. Let’s explore how this feature addresses your concerns and improves your experience.

Why Auto-Save Drawings Matter?

This statistic highlights the magnitude of the problem. Losing your work disrupts your flow, increases frustration, and wastes time. Recognizing the importance of resolving this, we’ve focused on delivering a robust backend solution to automatically save and sync your drawings.

How It Works?

  1. Automatic Backend Save for Drawings: Whenever you create or update a drawing on any chart, our backend system saves it instantly. This auto-save functionality ensures that even if you switch platforms or refresh your screen, your drawings will be exactly where you left them.
  1. Scrip-Specific Retention: Each scrip (stock or asset) gets its dedicated drawing save. This means that no matter how many charts you annotate, the backend remembers your work and loads it effortlessly every time you revisit that scrip.
  1. Seamless Multi-Panel and Split View Behavior: Our system ensures that the last saved action on each scrip is saved individually, even when viewed in a multi-panel layout. On refreshing or reopening, each scrip will load with its respective saved drawings.

Why Should You Choose This Product?

  • Better User Experience: With drawings persisting seamlessly, you can focus more on your analysis and less on redoing your work.
  • Increased Reliability: No more guesswork. You can trust that your charts will appear exactly as you left them, regardless of platform or session.
  • Time Savings: By eliminating the need for manual saves and reducing errors, you’ll save valuable time and effort.
  • Cross-Platform Consistency: Whether you’re on web, iOS, or Android, your settings and annotations will synchronize effortlessly, giving you a unified experience.

What This Means for You?

This innovation is about more than just fixing a problem. It’s about delivering a seamless, frustration-free charting experience tailored to your needs. Whether you’re analyzing stocks on your desktop or making quick trades on your phone, your work will always be there, just as you left it.

Get Ready to Experience the Future of Charting

We’re excited to bring this enhancement to you soon. Stay tuned for updates, and prepare to elevate your trading and investing journey with Auto-Save Drawings. Your charts, your way—always.

Disclaimer – Investments in securities market are subject to market risks, read all the related documents carefully before investing.

This is for educational purposes Only

Such representations are not indicative of future results

Top 5 ETFs: How ₹1 Lakh Investment Grew to ₹1.77 Lakh in a Year Despite Recent Market Fall

Unlike traditional mutual funds, which have high equity exposure but cannot be traded directly on the stock exchange, Exchange-Traded Funds (ETFs) offer a unique advantage. They can track indices, commodities, or asset benchmarks and are bought and sold on stock exchanges like shares.

Investors must have a demat account to trade ETFs. They also enjoy a lower expense ratio compared to actively managed mutual funds. However, ETFs can only be bought or sold during market hours.

This article explores the top 5 ETFs that generated the highest annualised returns over the past year. Let’s see how an investment of ₹1 lakh in each ETF performed during this period.

1️. Mirae Asset Hang Seng TECH ETF

  • 1-Year Return: 77.29%
  • Assets Under Management (AUM): ₹339.18 crore
  • Net Asset Value (NAV) (as of Feb 20, 2025): ₹23.55
  • Benchmark: Hang Seng TECH Index TR INR
  • Expense Ratio: 0.57%
  • Launch Date: December 2021
  • Trading Volume: 51,67,153
  • Investment Growth: ₹1,00,000 to ₹1,77,286

2️. Mirae Asset NYSE FANG+ ETF

  • 1-Year Return: 48.89%
  • AUM: ₹18,371.55 crore
  • NAV (as of Feb 20, 2025): ₹117.8268
  • Benchmark: NYSE FANG+ TR USD
  • Expense Ratio: 0.66%
  • Launch Date: April 2021
  • Trading Volume: 12,28,629
  • Investment Growth: ₹1,00,000 to ₹1,48,888

3️. UTI Gold Exchange Traded Scheme

  • 1-Year Return: 39.44%
  • AUM: ₹1,598.78 crore
  • Unit Price (as of Feb 20, 2025): ₹73.6799
  • Benchmark: Domestic gold prices
  • Expense Ratio: N/A
  • Launch Date: April 2007
  • Trading Volume: 2,65,174
  • Investment Growth: ₹1,00,000 to ₹1,39,436

4️. Kotak Gold Exchange Traded Scheme

  • 1-Year Return: 37.69%
  • AUM: ₹6,654.06 crore
  • NAV (as of Feb 20, 2025): ₹72.8476
  • Benchmark: Domestic gold prices
  • Expense Ratio: 0.55%
  • Launch Date: July 2007
  • Turnover Ratio: 13.07%
  • Investment Growth: ₹1,00,000 to ₹1,37,687

5️. IDBI Gold ETF

  • 1-Year Return: 38.86%
  • AUM: ₹188.77 crore
  • Unit Price (as of Feb 20, 2025): ₹7878.3312
  • Benchmark: Domestic gold prices
  • Expense Ratio: 0.35%
  • Launch Date: November 2011
  • Trading Volume: 3,858
  • Investment Growth: ₹1,00,000 to ₹1,38,856

Conclusion

ETFs have emerged as a compelling alternative for investors seeking exposure to equity indices, commodities, or asset benchmarks while maintaining liquidity. The top-performing ETFs over the past year have demonstrated resilience, particularly those tracking technology stocks and gold prices.

Although past performance is not indicative of future returns, ETFs remain an efficient investment vehicle with lower expense ratios and market credibility. Understanding their performance trends can help investors make informed decisions.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Mutual Fund investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Nifty Among 2025’s Worst-Performing Markets, Joins Thailand and Philippines

Indian equity markets, once a beacon of growth, have had a turbulent start to 2025. The Nifty50 Index, a benchmark tracking the country’s top 50 companies, has slumped by 6% in US dollar terms since the beginning of the year. This sharp decline places Nifty among the worst-performing emerging market indices, trailing only Thailand’s SET Index and the Philippines’ PSEi Index.

Comparing Global Market Performance

While the Nifty 50 has struggled, the Thai and Philippine stock markets have seen even steeper declines. Thailand’s benchmark index has plunged nearly 10%, and the Philippines’ PSEi Index has dropped 6.7%. Indonesia’s Jakarta Composite has also seen a 5.7% fall during the same period.

In stark contrast, Hong Kong’s Hang Seng Index and South Korea’s Kospi have led gains in Asia, rising by 16.4% and 14%, respectively. Despite a 25% surge in Chinese stocks, the Shanghai Composite still trades at a valuation of 12.3 times its one-year forward earnings, while the Kospi is valued at 9.3 times. Comparatively, the Nifty 50 remains more expensive at 18.7 times forward earnings.

Declining Investor Confidence in Indian Markets

According to reports, investor sentiment towards Indian equities has waned significantly. A recent survey indicated that only 19% of fund managers hold a positive outlook on the Indian market over the next 12 months, a sharp decline from 10% in January.

Allocations to Indian equities have now collapsed to a 2-year low, as investors favour Japan and Taiwan. Japan remains the top choice among global investors, bolstered by record-high economic optimism, while Taiwan follows at a distant second.

Foreign Investors Exit Amid Valuation and Currency Concerns

Foreign portfolio investors (FPIs) have continued their selling spree, offloading $400 million worth of Indian shares on February 21 alone. Since October last year, FPIs have collectively sold $24 billion worth of Indian stocks on a net basis.

The exodus of foreign investors was initially triggered by concerns over India’s high valuations and slowing economic growth. However, rising US bond yields and a depreciating rupee have further intensified the sell-off. With US Treasury yields hovering around 4.4% and the Indian rupee weakening by 3.2% against the US dollar over the past six months, Indian equities have become less attractive to global investors.

Conclusion 

While Indian markets grapple with heightened volatility, the broader trends suggest a shift in global investor preference towards markets perceived as more stable and offering better valuations. Whether the Nifty 50 can recover in the coming months will depend on macroeconomic factors, foreign fund flows, and domestic market resilience.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.