The premium valuations commanded by the domestic equity markets to their global peers is a sign of trust and faith that the world has on India, said Madhabi Puri Buch, chairperson, Securities and Exchange Board of India (Sebi). The comment comes within weeks of Buch raising concerns on ‘pockets of froth’ in the domestic markets, specifically in smallcaps, prompting some mutual funds to restrict flows into such schemes. Speaking at the CII National Corporate Governance Summit on Tuesday, Buch said, “Our markets are commanding this price-to-earnings (P/E) multiple, which is higher than the averages of world indices. Some say that we are an expensive market but still why is the investment coming? (It is) because of the trust and faith that the world has in India that we are commanding these kinds of multiples.” The benchmark Sensex currently trades at a trailing 12-month P/E multiple of 23.5x, higher than most global peers and below only to major markets such as the US and Japan. The Sens