Despite the sharp decline over the past week, Indian markets remain fundamentally strong, argue bulls. The 2,000-point drop is a healthy correction in a market that had run up too fast. The underlying earnings momentum justifies the long-term bullish case.
AU Small Finance Bank's 37% profit growth and 32% NII expansion show that the banking sector is recovering well. The bank's focus on affordable housing and microfinance is paying off. Lodha Developers doubling its net profit underscores the real estate boom, particularly in the luxury segment, which is benefiting from rising incomes and urbanization.
Even Paytm's pivot from payments to AI-based services and a wallet licence indicates that the company is adapting to a changing regulatory landscape. These companies are not just surviving but thriving in a tough environment.
The selloff is largely driven by external factors — US rate fears and global risk aversion. Domestic fundamentals such as strong GST collections, manufacturing PMI above 58, and healthy corporate balance sheets remain intact. Foreign investors may be selling, but domestic institutions and retail investors are stepping in.
The market correction offers a buying opportunity for those with a long-term horizon. The Indian economy is expected to grow at 7% this year, and corporate earnings are projected to rise by 15-18%. The current dip is temporary, and the medium-term outlook remains positive.