Do you feel that the Sensex doubling over the last 15 months is really justified based on fundamentals of the market?

You are right about the Sensex appreciation. For example, from a low of 25,638 in March 2020, the BSE Sensex is up 116% over the last 16 months. That has led to market analysts being worried about Sensex climbing a wall of worry. There are fundamental factors like reduced debt and lower operating costs. But, I would like to highlight three important factors that actually justify the sharply higher Sensex viz. Interest rates, oil and liquidity.

Now, interest rates are at their lowest in history, which justify higher P/E even with static earnings. Let me now turn to oil. Oil prices have played a major role in what is called the wealth effect. Due to weaker oil prices for 5 years, a massive shift of wealth has happened from oil exporters to oil importers like India. Above all, the real difference is relentless flow of liquidity into markets. In a way, that tends to defy all other concerns in the market.