Just 5 months ago when the markets had crashed, many people said that India was headed towards a bear market and only, DalalStreet.Biz ruled out and we started BUYING at those attractive levels. Keep invested. You will see many more record levels. Valuations do justify earnings in most stocks(not all) and India is the last big emerging market the world will see. FIIs have pumped in $3 Billion since the June crash. One FII will sell while other will BUY, and according to me their will be more buyers than sellers and hence India may look overvalued at certain time, but stay invested.
Small investors, kindly take the Mutual Fund and SIP route to make money as it is currently tax free. Have a great weekend!