Why India’s Stock Market Boom May Be a Middle-Class Mirage
Sundararaman Ramamurthy, MD & CEO, BSE was the chief guest at Zee Busineses Mutual Fund Awards, 2025. (Image BSE India, X)
At the Dezerv Wealth Summit 2025, strategist Siddhartha Bhaiya warns that SIP-driven euphoria masks a silent wealth transfer as valuations stretch beyond reality.
By P. SESH KUMAR
New Delhi, December 20, 2025 — At the Dezerv Wealth Summit 2025, veteran market strategist Siddhartha Bhaiya delivered a blistering take on India’s equity markets, declaring them a “bubble of epic proportions.” In plain, punchy language, he dissected why recent stock market euphoria isn’t the result of healthy investing but a systematic wealth shift from the broader middle class into the hands of a few. This critique isn’t just alarmist noise; it’s a wake-up call that unravels common myths around mutual funds, SIPs (Systematic Investment Plans), and what a sustainable bull market really looks like in India’s financial ecosystem.
Walking out of this discussion, one would be left with a vivid picture of inflated valuations, misplaced confidence, and the urgent need for smarter, grounded investing—before the bubble bursts.
When Siddhartha Bhaiya stepped onto the virtual stage at the Dezerv Summit, he didn’t dress up his message in financial jargon to impress. Instead, he grabbed the bull by the horns and called out a market he believes is dangerously overheated. His key contention? What most investors celebrate as a roaring rally is less about fundamental value and more about unsustainable inflows that have driven prices to dizzying levels. In his words, “we are in a bubble of epic proportions.”
To appreciate why this matters, imagine blowing air into a balloon. If we blow steadily and carefully, it expands predictably. But we blow too hard, too fast, and the fabric stretches beyond what it can sustainably hold- until pop. That’s essentially Bhaiya’s metaphor for today’s Indian markets: valuation levels stretched far beyond what economic reality supports. Investors are celebrating gains, but the foundation beneath those gains is thinner than it looks.
A central piece of his critique targets SIPs—a popular way for ordinary Indians to invest in equities by contributing small amounts regularly. SIP stands for Systematic Investment Plan, a disciplined strategy designed to smooth out market volatility over time. Yet Bhaiya suggests something provocative: the rally we’re seeing isn’t purely driven by genuine SIP inflows from retail savers but rather a kind of Systematic Wealth Transfer (SWT) from the pockets of the middle class into assets being offloaded by big promoters and institutional players riding the wave.
This idea flips the prevailing narrative. Instead of SIPs democratizing market gains, Bhaiya argues they’re inadvertently feeding into a cycle where retail money flows into stocks at peak prices—right when larger players are reducing their holdings. If true, that’s not empowerment, it’s bad timing for everyday investors.
Then there’s the issue of asset allocation—the financial principle of spreading our money across different types of investments (like stocks, bonds, and gold) to manage risk. In a textbook bull market, investors stick to their asset allocation plans no matter how high one segment runs. But Bhaiya points out that in the current frenzy, these plans are being thrown out the window as people chase returns, piling into equities without respect for diversification.
Why is this so concerning? Because it sets up a collective blind rush toward the exits when sentiment finally shifts. Markets driven by emotion and momentum rather than fundamentals—such as corporate earnings growth, realistic price-earnings ratios, and healthy economic indicators-are inherently fragile. A small shock can trigger large swings, and when valuations are stretched, those swings can be severe.
What makes Bhaiya’s take compelling isn’t just the dire language. It’s that he connects these abstract financial concepts to the lived experience of investors. For instance, instead of talking only about charts and indices, he explains how the middle class, often encouraged by headlines and rosy forecasts, may unknowingly be buying high and selling low—the exact opposite of sound investment behaviour.
Yet this talk isn’t pure doom and gloom. Recognizing a bubble is the first step toward building resilience. By understanding what’s driving market pricing, everyday investors can choose to reinforce their financial defences- think stronger asset allocation, informed decision-making, and scepticism of one-sided optimism.
India’s market participants may need to pivot from momentum-chasing to value-seeking. That means revisiting core investment principles—understanding earnings growth, respecting valuation limits, and resisting the herd instinct. Financial literacy campaigns should go beyond buzzwords and equip investors with tools to discern genuine market strength from speculative froth. Regulators and advisors must emphasize transparent, long-term planning over short-term sentiment. Will it be incorrect to say that only by acknowledging the bubble—not denying it—can smart strategies be put in place that protect wealth rather than imperil it.
(This is an opinion piece, and views expressed are those of the author only)
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