Indian equities experienced a significant downturn, with smaller stocks facing their worst single-day drop in over two years. The S&P BSE SmallCap Index surged over 56% in the past year, while the BSE MidCap Index increased over 62%, outperforming the Sensex's 26% rise. However, recent concerns raised by the securities regulator about froth and stretched valuations in the market have led to a sharp decline. The Securities and Exchange Board of India (SEBI) is advising caution amid these market conditions. The market's reaction was swift, with an $80 billion crash in India's small-cap stocks, indicating a souring risk appetite among investors. This downturn led to the Sensex crashing 906 points and the Nifty giving up the 22k mark, with mid and small caps bleeding significantly. The market turmoil has also resulted in a huge margin call on the National Stock Exchange (NSE) as mid-cap and small-cap stocks fell, highlighting the broader concerns affecting investor sentiment and market stability.