Zerodha cofounder Nitin Kamath on Friday raised alarm over the ongoing bloodbath in the stock markets. Voicing concern, Kamath said he has no idea where the markets will go from here, adding that he is already seeing a massive drop in both the number of traders and volumes.
Kamath’s tweet came in the wake of a steady sell-off in the Indian markets, including on Friday, with the BSE Sensex registering a staggering 1,400 points decline.
“The markets are finally correcting. Given that markets swing between extremes, they can fall more just like they rose to the peak,” Kamath tweeted in a long post on X.
The markets are finally correcting. Given that markets swing between extremes, they can fall more just like they rose to the peak.
— Nithin Kamath (@Nithin0dha) February 28, 2025
I've no idea where the markets go from here, but I can tell you about the broking industry. We are seeing a massive drop in terms of both the number… pic.twitter.com/wHO6hSRdbA
“Across brokers, there’s a more than 30% drop in activity. Combined with the true-to-market circular, we are seeing degrowth in the business for the first time since we started 15 years ago,” Kamath tweeted, highlighting the drastic drop in the number of traders and volumes being traded on his platform since the correction in the markets.
The Zerodha cofounder further added that the drying up of volumes demonstrated the shallowness of the Indian markets, pointing out that active trading is still limited among 1-2 crore Indians.
Kamath suggested that if the ongoing market correction persists, the Indian government’s revenue from the Securities Transaction Tax (STT) could drop by 50% to Rs 40,000 crore in FY 2025-26, far below the projected Rs 80,000 crore.
On Friday, February 28, 2025, India’s benchmark indices, Nifty50 and Sensex, saw a sharp decline due to the impact of President Trump’s tariffs, continued selling by Foreign Institutional Investors (FIIs), and weak global signals.
The BSE Sensex plunged 1,400 points to 73,189, while the Nifty50 dropped below the 22,150 mark.
In recent months, the Indian stock market has been going through a correction phase, with benchmark indices Nifty and Sensex seeing a sharp decline from their record highs last year.
