India Stocks Lag Global Peers: Is Your SIP Safe?

Indian stock markets have underperformed the US, Japan, and South Korea recently due to global AI investment flows and high valuations. But India's strong domestic growth story means long-term SIP investors have little reason to panic.

Here's what happened: Indian equity indices have delivered lower returns than US, Japanese, and South Korean markets over the past 12-18 months, mainly because global capital flowed toward AI-driven tech sectors concentrated in those countries.. High valuations on Indian large-cap stocks made them less attractive to foreign portfolio investors, leading to net FPI outflows that weighed on index performance in FY2024-25.. Despite the relative lag, India's GDP growth, domestic consumption demand, infrastructure spending, and corporate earnings fundamentals remain among the strongest in any major emerging economy..

What you should do: Check your SIP's absolute XIRR return in your mutual fund app — compare it to your personal inflation rate, not to the S&P 500, which is a completely different market.. Avoid pausing or stopping SIPs during underperformance phases — historically, investors who stayed invested through India's flat periods captured the sharpest subsequent recoveries.. Diversify across large-cap, mid-cap, and flexi-cap funds rather than chasing international or thematic AI funds now that they are already at elevated valuations..

Pro tip: Rupee-cost averaging works hardest when markets are flat or falling — every SIP instalment buys more units, silently lowering your average cost for the eventual upturn.

For readers weighing their credit and loan options, our personal loan guide and CIBIL score resources put this update in context.