Abstract：Foreign funds pulled roughly Rs 3 lakh crore out of Indian equities in 2026, with about Rs 36,000 crore of that leaving in September alone. Those are the numbers in a widely shared post on X by Vivek Khatri (@CaVivekkhatri), whose argument runs in one direction: the Nifty is cheap in rupees and expensive in dollars.
The post's snapshot: Nifty PE near 19.2, the rupee near 96.3, the US 10-year Treasury at 5.28%. Individually, those look calm. Over a year, they do not.
According to the post, the rupee is down about 8.5% over the year, about 7% in 2026, and almost 10% in the last financial year alone. The Nifty is down about 13% over the same stretch. Nifty IT is down about 27%.
"They still bought IPOs," the post says of foreign investors. "They sold the secondary market."
Put in position terms: a single-currency valuation is not a cushion if the currency itself is moving against you.
Foreign funds pulled roughly Rs 3 lakh crore out of Indian equities in 2026, with about Rs 36,000 crore of that leaving in September alone. Those are the numbers in a widely shared post on X by Vivek Khatri (@CaVivekkhatri), whose argument runs in one direction: the Nifty is cheap in rupees and expensive in dollars.
The post's snapshot: Nifty PE near 19.2, the rupee near 96.3, the US 10-year Treasury at 5.28%. Individually, those look calm. Over a year, they do not.
According to the post, the rupee is down about 8.5% over the year, about 7% in 2026, and almost 10% in the last financial year alone. The Nifty is down about 13% over the same stretch. Nifty IT is down about 27%.
“They still bought IPOs,” the post says of foreign investors. “They sold the secondary market.”
Put in position terms: a single-currency valuation is not a cushion if the currency itself is moving against you.
ContentsThe Arithmetic Under a 19.2x Multiple
A 19.2x PE works out to an earnings yield of roughly 5.2%. That is the post's own maths, and it sits below the 5.28% available on US Treasuries — risk-free, with no India risk and no rupee risk.
A year ago, that US 10-year was around 4.1%. The post does not treat the move as background noise. It calls the required return “5.28% plus currency plus equity premium” and puts the total at 13% to 15%, in dollars.
The post lines up two reference points that point in opposite directions. The five-year median Nifty PE is about 22, so 19.2 looks cheap against the last five years. The COVID low was about 18.5, so 19.2 looks close to a crisis multiple against 2020.
The post picks the second comparison. “You also cannot sell a 19 PE as a bargain when COVID lows were 18.5 and the dollar hurdle is 13–15%,” it says.
Whether that holds depends on how much India risk premium you assign. The post never puts a number on it. It is one investor's thread, not a research note.
The Rupee is the Variable Doing the Damage
Strip the argument to its mechanism and the exchange rate is what carries the weight.
An investor holding rupee assets in dollar terms needs the asset to rise by at least the currency's fall just to stand still. In a year when the rupee drops 8.5%, that is the starting line, not the finish. The Nifty, by the post's own figures, is falling at the same time.
The post does not give a dollar-denominated Nifty return. The direction is clear enough: an 8.5% currency hit stacked on a rupee decline produces a worse dollar number than the rupee chart shows. The size of that gap is left open.
The alternative is spelled out in the same post. A 5.28% US Treasury with no India exposure and no rupee exposure. That is the bar.
“You cannot control US yields,” the post says. “You cannot control crude. You cannot control the war.”
You also cannot reclassify a 19x multiple as a bargain when the comparison point is 18.5x.
Where the Money Went, and Where it Did Not
Of the roughly Rs 3 lakh crore that left Indian equities in 2026, the post isolates September at about Rs 36,000 crore.
The split matters more than the total. Foreign investors kept taking IPO allocations while selling down secondary holdings. The post does not explain the divergence. It does not have to — primary allocation is a placement decision, secondary selling is a holding decision, and the two can run in opposite directions for months.
The damage inside the index was uneven. Nifty IT fell about 27% against the Nifty's roughly 13%. The post attributes that to fading dollar growth in the IT sector, without elaborating.
That is four threads placed side by side: crude, yields, geopolitics, IT earnings. The post does not rank them. It does not say which one breaks first.
What the Social Feed is Arguing About
Five related posts add detail, and some disagreement.
@MarketSmithIND pins the yield number to a date: the US 10-year touched 5.29% on 30 September, and India's 10-year is at its highest since April 2024. That corroborates the main post's 5.28% and sharpens the timing.
@mammetgzla frames the risk differently. India's biggest market risk right now may not be the Nifty, the post argues, but a chain reaction running from crude above USD 100 into inflation pressure. The focus shifts from valuation to input costs.
@PrabhuChawla takes the contrast line — “fastest economy, weakest market” — and adds that behind the abstractions are real people, pointing at the market clerk rather than the index level.
@Morpheu5Watcher flattens the timeline: Indian stocks have fallen eight weeks in a row, the market sat out Friday, and it reopens against two more tanker strikes.
@marketsday asks whether the ninth week goes the same way, and lists what it says will drive the market from Monday, 4 October: TCS's Q2 numbers and four other factors it does not name.
Where they agree: foreign money is selling, yields are high, crude and geopolitics are live. Where they differ is on which of those is the cause and which is the symptom. None of the posts settles it. Neither does the main thread.
What to Watch on Your Positions
The post itself leaves three checkable numbers on the table: the US 10-year at 5.28%, the rupee near 96.3, and the Nifty at 19.2x.
The dollar-hurdle logic follows from those. As long as the dollar risk-free rate sits at or above the earnings yield on Indian equities, the 13–15% dollar hurdle does not come down on its own. Something has to give — either the rupee stops falling, or valuations compress further. The post argues neither has happened.
For anyone holding USD/INR, the framework places the US–India rate differential at the centre, not the Nifty's multiple. Forward points and overnight carry move with that differential, but the post supplies no numbers for either. Use your own platform's quotes, not a thread's.
The nearest date on the calendar is Monday, 4 October, when the market reopens, alongside the TCS Q2 results flagged by @marketsday. Until then, every number in the post stays on the screen.
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