From being the most preferred market a year or so back, India has turned out to be the worst performer so far in calendar 2015.

It has been almost a year since Narendra Modi romped home with a majority and triggered hopes of an economic recovery backed by policy reforms.

Macros too had turned favourable with crude oil prices hitting new lows and inflation heading south.

But, now, after a few quarters of weak corporate earnings and the sudden increase in crude oil prices over the past few weeks, foreign investors seem fidgety and appear to be taking some profits off the table, net selling close to $1.8 billion between April 15 and now.

After delivering 30 per cent return in calendar 2014, the Nifty has fallen close to 3 per cent till date in 2015. In contrast, other emerging markets have delivered healthy returns — Brazil (Bovespa Index 17 per cent), Russia (MICEX 17 per cent) and China (Shanghai Composite Index 23 per cent).

Some may argue that the Nifty is still trading below its historical averages and lower than some of the global indices. Each of the global indices — S&P 500, FTSE 100, and Nikkei 225 — trades at 16-18 times its one-year forward earnings. Trading at 15.2 times its one-year forward earnings, Nifty still seems attractive when compared to its five-year historical average of about 19 times, and the lofty 22-24 levels of 2008.

But that argument hardly holds water in the light of the poor show put up by Corporate India in the recent March quarter.

The price-to-earnings of a company is pegged higher for those with a higher earnings growth. The same holds true for markets. India’s growth is expected to be higher than the American and Japanese markets. Bloomberg estimates earnings growth of 5 per cent for S&P 500 over the next one year and 18 per cent for Nikkei’s 225 companies.

Nifty earnings are expected to deliver 22 per cent growth over the next one year. But with corporate earnings still languishing and expected to recover only in the next year or so, these growth estimates seem too optimistic.

With the new government close to completing a year in office, there are now doubts about the high-drive reforms taking shape in a hurry.

Even so, reforms will only gradually result in an earnings pick up. Many market players do not expect a sharp jump in earnings in fiscal 2016. The big move, if any, is likely to happen only in 2017.

Till such time, Indian markets are likely to see some more profit booking.