Neelkanth Mishra of Axis Capital thinks the markets can correct by another 10%.

According to Neelkanth Mishra, Chief Economist at Axis Bank, Head of Global Research at Axis Capital, and Chief of UIDAI, there is still room for a further 10% market correction in light of the recent collapse in Indian stocks.

 During a fireside chat at Moneycontrol's Global Wealth Summit 2025, which is being held in Mumbai today, Mishra expressed these opinions.

 In addition to his forecasts, Mishra stated that a rise in nominal GDP that does not result in a change in market capitalization is the most likely cause of the correction. He also mentioned that the market's multiples will likely stay erratic, particularly given that Indian markets just reached previously unheard-of record highs.

"There's always going to be a range within which the market will be trading," he stated.

 An important contributing element to the market's dramatic fall over the past six months has been India Inc.'s notable halt in profits growth. Corporate profitability in FY25 were severely impacted by headwinds such as declining pent-up demand, high base, faltering consumption, and poor urban wage growth.

 Mishra, however, presented a more upbeat perspective, arguing that as long as India's structural narrative is maintained, the GDP slowdown should eventually calm down. "Don't assume that over the next five to six years, profits will increase more slowly than nominal GDP. A larger market-cap-to-GDP ratio ought to benefit from that, Mishra continued.