India Stock Market Valuations and Expected Future Returns

Updated at Sun, 23 Oct 2016 20:30:09 -0500
Country: India (updated daily) check out Global Overview for detailed methodology.

Ratio of total market cap over GDP: Maximum - 158%; Minimum - 40%; current - 69%
Expected future annual return: 16.0%

ETF Used for dividend yield: BATS:INDA (Yield=0.7%)
Market Index used: BSE SENSEX
Current Annual GDP: $2,370 billion US dollars or 141,095 in billions of national currency (GDP in Local Current Prices Annual Growth=13.88%)
Data since year 1997

India Historical GDP Growth

Historical GDP of India in billions of national currency. The GDP in local current prices has grown at the annual rate of 13.88% over the past 8 years. Please note this growth rate includes the effect of price inflation and it is NOT the real GDP growth rate. Current Annual GDP: $2,370 billion US dollars or 141,095 in billions of national currency.

India GDP (Billion, National Currency)

Historical Stock Market Cap

Historical total market of India in billions of national currency. This value is normalized using the data published by WorldBank. BSE SENSEX is used for the normalization. The Bombay Stock Exchange SENSEX also referred to as BSE 30 is a free-float market capitalization-weighted stock market index of 30 well-established and financially sound companies listed on Bombay Stock Exchange.

India Total Market Cap (Billion, National Currency)

Historical Ratio of Total Market Cap over GDP (%)

The current ratio of total market cap over GDP for India is 69%. The historical high was 158%; the historical low was 40%. If we assume that the ratio will reverse to the historical mean of 77% over the next 8 years, the contribution to expected annual return is 1.37%. This is the detailed historical chart of the ratio.

India Ratio of Total Market Cap over GDP (%)


The stock market of India is expected to return 16.0% a year for the coming years. This is from the contribution of economic growth in local current prices: 13.88%, Dividend Yield: 0.7% and valuation reverse to the mean 1.37%.

This is the projected return of the stock market in India relative to other countries. Click on each bar in the chart to go to other countries:

You can go here to see what international stocks Gurus are buying.

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