Capitalmind
Capitalmind
Actionable insights on equities, fixed-income, macros and personal finance Start 14-Days Free Trial
Actionable investing insights Get Free Trial
Charts & Analysis

Chart Of The Day: Long Term Market Cap To GDP

Market Capitalization to GDP isn’t really a comparable figure, since one is a measure of wealth and the other dynamic measure of transactions in a year. Yet, it’s useful to see valuations in comparison with where they were earlier.

image

(GDP figures from RBI quarterly database, Marketcap from NSE/BSE)

We are at levels last seen in 2008, and earlier, in 2005. Note that in the earlier bubble – 1999-2000 – we were at less than 60% of GDP. Much of India Inc. has listed in the last decade, so it’s not very surprising. It does show though, that 60% is not uncharted territory.