The PE ratio of Indian stock markets was recorded on 11 April 2025, which is more than the lowest 9.7 seen in this ratio of 20 years and the recession of 20 years.
This shows that the shares of the Indian stock market are very high as the PE ratio of the Indian stock market is much higher than other emerging countries. In contrast, the PE ratio of the stock markets of South Korea, Taiwan and Japan is very close to the average of the decline seen during the recession.
Except for Indian and Australian stock markets, the PE ratio of all other emerging stock markets is below an average of 20-year of this ratio. The Indian stock market has now managed about 10 per cent from the lower level in April due to the decline in the stock markets after US President Donald Trump imposed mutual tariffs on various countries around the world on 2 April. In comparison, only other emerging markets have seen such a decline in the stock market of Australia. Apart from this, the decline in the stock markets has not been compensated yet. MSCI’s emerging market index is also 7 percent below this decline.
In such circumstances, experts believe that it is a reality that the value of Indian shares is higher than in other countries. Additionally, since the income growth rate of various companies is expected to be low in the financial year 2025-26, the shares of these companies can be seen to fall. However, different aspects of India’s economy are very strong, which is less likely to fall in the stock market. In particular, the rate of inflation is under control, the trade deficit is also limited, the economic growth rate is also expected to be above six percent, the foreign exchange reserves are at a strong level and most importantly, the investment made by retail investors through mutual funds and direct investment is also increasing. Due to all these factors, the possibility of major improvement in the stock market is very low.
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