India’s stock market is booming, helped by billions of dollars of inflows from international funds and a fast-growing army of small investors. The MSCI India index has gained more than 7% this year, pulled higher by a rally in the shares of banks and automakers.

India’s stock market is setting up for the longest bull run in its history. Increased domestic investment in stocks, growing social equity and other factors could boost earnings 20% annually over the next five years.

India’s IPO boom is a testament to its economic vibrancy and increasingly sophisticated capital markets. Economic recovery, regulatory support and the rise of the startup ecosystem are among the factors driving the boom, which opened new opportunities for companies and investors alike.

India’s benchmark Sensex index, which tracks 30 large companies, has soared 10% over the past three months, while the broader Nifty 50 index has jumped 11% in that time. Both indexes hit all-time highs last Wednesday.

In 2024, Indian markets delivered impressive returns, with the Nifty 50 gaining 8.8% and the Nifty 500 soaring 15.2%. Over the past five years, these indices have achieved annualized returns of 14.2% and 17.8%, respectively, contributing to sustained investor confidence.