Nithin Kamath, the founder of Zerodha, expressed concerns about the current state of India's stock market, indicating it may be experiencing speculative activity rather than a true bull market. In a recent post, he noted that while shares of brokerage firms are rallying due to expectations of sustained retail participation, key indicators suggest otherwise. Notably, cash market turnover remains below the peak levels seen in late 2024, indicating that core delivery-based equity activity has not yet returned to previous highs. Furthermore, net direct equity inflows have turned negative for the first time since the fiscal year 2019, suggesting that retail investors are pulling back from direct stock purchases. Despite this, mutual fund participation is at a record high, with gross Systematic Investment Plan (SIP) flows reaching ₹32,000 crore. However, Kamath pointed out that this does not necessarily translate into increased income for brokerage firms like Zerodha, which primarily offers direct mutual funds with little or no distribution commission. Instead, revenue growth may be driven by speculative trading, as evidenced by Zerodha's margin trading funding growing to ₹7,000 crore in just 18 months. Kamath emphasized the importance of a cautious trading approach, advocating for fewer trades to minimize risk.