DayStarter

Market snapshot

Equities: Thursday close

The Nifty opened 147 points higher at 24,225. Global cues improved after the US Treasury doubled the size of buybacks for long-duration government debt. The move helped cool US Treasury yields and the Dollar Index.

The Nifty initially fell towards 24,185 to 24,190, then recovered above 24,200. During the first hour, it mostly traded between 24,200 and 24,220.

Buying became stronger after 12:30 pm. The index moved above 24,240 and reached an intraday high near 24,260 at around 1 pm. It stayed mostly between 24,230 and 24,250 through the afternoon.

Some selling after 3 pm pulled the Nifty towards 24,210. A final recovery helped it close at 24,231.85, slightly above its opening level and more than 150 points higher for the day.

The Nifty gained 153.55 points, or 0.64%, ending a seven-day losing streak. The Sensex rose 628.04 points, or 0.82%, to 77,537.72 after four days of decline. During the session, the Sensex had risen as much as 701.43 points, or 0.91%, to 77,611.11.

Among Sensex companies, Eternal, Kotak Mahindra Bank, ITC, Bajaj Finance, Axis Bank and UltraTech Cement were the strongest performers. Tata Steel, InterGlobe Aviation, HCL Tech and Titan were the laggards.

The BSE SmallCap Select index rose 0.83%, while the MidCap Select index gained 0.56%.

Sector performance

Media was the strongest sector, rising 2.13%. Realty gained 1.41%, while FMCG and IT rose 0.82% and 0.79%.

PSU Bank was the only sector in the table to finish lower, falling 0.01%.

F&O winners and losers

MCX was the strongest F&O stock, rising 5.15%. Muthoot Finance gained 3.88%, while Glenmark rose 3.85%.

PFC was the biggest loser, falling 2.84%. REC declined 2.64%.

Commodities

Crude oil futures rose 1.86%. Silver gained 1.12%, while zinc rose 0.80%.

Natural gas fell 2.51%. Aluminium and copper also declined.

Currency and bond yields

USDINR fell slightly to 95.64.

The US 10-year Treasury yield fell to 4.65 from 4.70. India’s 10-year government bond yield rose to 6.86 from 6.81.

Institutional flows

Foreign institutional investors sold Indian equities worth a net ₹583 crore on 20 August.

Domestic institutional investors bought a net ₹3,538 crore.

Across the five sessions shown below, FIIs were net sellers of ₹550 crore, while DIIs were net buyers of ₹15,548 crore.

Macro view

Growth and industry

Core sector and industrial activity

India’s infrastructure output grew 5.4% year-on-year in July, slower than the revised 6% growth recorded in June.

Growth was led by:

• Iron ore: +29.5%.
• Cement: +13.1%.
• Electricity: +9%.
• Coal: +7.6%.
• Steel: +2.9%.
• Refinery products: +2.7%.

Refinery products returned to growth after falling 4% in June.

Three sectors contracted:

• Fertiliser production fell 8%, after declining 3.3% in June.
• Crude oil production fell 5.3%, after contracting 4.2% in June.
• Natural gas production fell 3.7%, compared with a 4.8% decline in June.

During April to July 2026, the core sector grew 4.3%, much faster than the 1.5% growth recorded during the same period in 2025.

Over these four months:

• Iron ore grew 25.2%.
• Cement grew 9.9%.
• Electricity grew 9.3%.
• Steel grew 4.5%.
• Coal fell 3.1%.
• Natural gas fell 4.4%.
• Crude oil fell 4.3%.
• Refinery products fell 2.5%.
• Fertilisers fell 5.2%.

The eight core industries account for 40.27% of the weight in the Index of Industrial Production.

Iron ore recorded its third consecutive month of double-digit growth, although July growth of 29.5% was below the 44.5% recorded in June.

Monetary policy and inflation

The RBI kept the repo rate unchanged at 5.25% in August and maintained a neutral policy stance.

The meeting minutes showed greater concern about inflation staying high.

MPC member Ram Singh said 69% of the weighted CPI basket recorded inflation of 4% or less in June. However, he also said the distribution was shifting towards higher inflation.

The governor and other MPC members warned that higher food and fuel prices could create second-order effects, where initial price increases begin to spread into other parts of the economy.

A Mint analysis found that 28% of CPI items had inflation above 4% in July. This was slightly below 29% in June but well above 18% in January.

Sugar imports and domestic prices

India allowed duty-free imports of raw sugar to reduce pressure from record domestic prices.

The government will allow imports of up to 1 million tonnes of raw sugar until 31 October without tax.

These imports normally face a 100% levy.

Only companies with their own refining capacity can import under the scheme.

Mills and refiners can apply between 21 and 28 August.

All processed sugar from these imports must be sold in India by 31 October.

Raw sugar futures in New York rose as much as 4.1% after the announcement, reaching their highest level since April 2025.

India also reduced the maximum stockholding period for bulk sugar consumers from 30 days to 15 days.

Ex-mill sugar prices in Maharashtra recently reached an all-time high.

Weather and water

Monsoon outlook

Private weather agency Skymet has become more pessimistic about the 2026 monsoon.

In April, Skymet had forecast rainfall at 94% of the long-period average, with a 70% chance of below-normal rainfall or drought conditions.

By August, it had reduced the forecast to 85% of the long-period average.

It also raised the probability of drought from 30% to 70%.

The reasons include a strengthening El Niño and uncertainty over a positive Indian Ocean Dipole.

Rainfall during June and July was already 13% below the long-period average.

Skymet expects August and September to remain deficient.

Reservoir levels

Live storage in 166 monitored reservoirs stood at 109.11 billion cubic metres on 13 August.

This was:

• 59.4% of their combined capacity.
• 19.6% below the 135.64 BCM recorded a year earlier.
• Close to the long-term normal of 111.75 BCM.
• 80.44% of last year’s level.
• 97.64% of normal.

These reservoirs account for 71% of India’s estimated total live-storage capacity of 257.812 BCM.

Regional storage levels were:

The western region was the only region where storage was above the previous year’s level.

Trade and external sector

Exports

India’s exports increased across many important markets in July.

The US remained India’s largest export destination, accounting for 20.4% of exports.

Shipments to the US rose nearly 13% year-on-year and reached their highest level since March 2025, before tariffs took effect.

Exports also increased sharply to:

• Singapore: +83.7%.
• Malaysia: +73%.
• Japan: +65.3%.
• China: +64.6%.

Exports to the UK fell 4.3%.

The top 10 export markets accounted for more than half of overall exports.

Rising commodity prices may have increased the reported value of shipments.

Rupee export payments

India eased its rules for export payments made in rupees.

Eligible rupee export receipts will now receive the same trade-policy benefits as foreign-currency earnings.

The Directorate General of Foreign Trade amended the Foreign Trade Policy with immediate effect.

Export contracts, invoices and payments with countries outside the Asian Clearing Union can now be denominated and settled in rupees or foreign currencies.

Eligible rupee receipts, except those involving Nepal and Bhutan, will qualify for trade-policy benefits and count towards exporters’ obligations when routed through approved banking channels.

India-EU trade agreement

India and the 27-member European Union have completed the legal scrubbing of the free-trade agreement text.

The agreement is expected to be signed this year on a mutually agreed date.

India and the EU had announced the completion of negotiations on 27 January.

India-Singapore agreements

India and Singapore signed agreements to strengthen cooperation in:

• Telecommunications and broadcasting.
• Maritime heritage.
• Food safety.

Two memorandums of understanding and one Letter of Intent were exchanged during the 4th India-Singapore Ministerial Roundtable.

Banking, credit and liquidity

FCNR(B), bank funding and liquidity

Banks are trying to raise funds before the RBI closes its special FCNR(B) deposit scheme earlier than originally planned.

The shorter window has compressed transactions that banks had expected to complete over a longer period.

ICICI Bank, Kotak Mahindra Bank and IDFC First Bank have tapped offshore markets since the RBI announced the early closure.

Yields on five-year and three-year papers rose by 9 basis points and 4 basis points to 6.45% and 6.21% respectively.

Non-food bank credit reached ₹219 trillion at the end of July, up 19% year-on-year.

Deposits increased more than 15% to ₹269 trillion.

RBI Governor Sanjay Malhotra said the RBI expects at least $80 billion of inflows through a combination of:

• FCNR deposits.
• External commercial borrowings.
• Overseas foreign-currency borrowings.

Gaura Sengupta, chief economist at IDFC FIRST Bank, said domestic banks could replace FCNR(B) funding with bulk deposits and reduce certificate-of-deposit issuance.

Foreign banks could face maturity mismatches if they place the new funds into five-year government securities.

Contract-farming credit

The government asked public-sector banks and the Indian Banks’ Association to develop a standard loan product and common documentation for contract farming.

The framework should also cover financing for farm machinery.

The work is expected to be completed within 6 to 12 months.

The proposed model includes:

• An anchor buyer or processor.
• Buyer payments through an escrow account with a defined waterfall.
• Separate limits for input finance.
• Procurement advances.
• Warehouse-receipt finance.
• Processing capital expenditure.

Lending decisions would be based more on the reliability of the buyer’s purchase agreement than on collateral.

The framework would also include:

• A model tripartite agreement between farmer, sponsor and bank.
• Uniform loan terms.
• Standard rules for quality rejections.
• Standard rules for price changes.

The government has also asked the IBA and Nabard to explore guarantees through the Credit Guarantee Fund Trust for Micro and Small Enterprises, National Credit Guarantee Trustee Co. Ltd and other mechanisms for the agricultural value chain.

Labour and skills

Labour-force participation

India’s labour-force participation rate for people aged 15 years and above rose sharply in July, led by rural women.

Rural female LFPR increased 220 basis points from June to 38.8%.

It was also higher than the 36.9% recorded a year earlier.

Urban female LFPR rose 50 basis points from June to 25.3%, but remained below the 25.8% recorded a year earlier.

Male LFPR was broadly stable:

• Rural male LFPR rose 40 basis points to 78.3%.
• Urban male LFPR fell 10 basis points to 75.2%.

Supreme Court and labour protections

The Supreme Court kept existing labour protections in place for pending disputes under the now-repealed Industrial Disputes Act.

The decision includes disputes involving government bodies.

The court retained the nearly five-decade-old test used to decide what qualifies as an “industry”.

The definition under the Industrial Relations Code, 2020 remains open for future cases.

The decision was passed by a 5:4 majority of a nine-judge Constitution Bench led by Chief Justice of India Surya Kant.

The court kept the “Triple Test” introduced in the 1978 judgment.

The test looks at whether an activity:

• Is organised.
• Involves cooperation between employers and workers.
• Produces or provides goods or services to meet human needs.

Skills and vocational education

Niti Aayog proposed wider employability and entrepreneurship training from Class 6.

It also proposed structured vocational tracks from Class 9.

The recommendations are part of its report, Reimagining Skilling for Viksit Bharat@2047.

Fewer than 1 in 12 secondary schools currently offer vocational subjects.

Energy and infrastructure

Premium petrol demand

Consumers are increasingly buying premium, high-octane petrol because of concerns that regular ethanol-blended petrol could affect mileage and engine life.

Premium petrol’s share of sales has risen to around 12% to 15% from around 4% in March.

Higher-octane petrol such as Indian Oil’s XP95, Bharat Petroleum’s Speed and Hindustan Petroleum’s Power95 costs around ₹110 to ₹115 per litre.

Regular petrol costs around ₹102 per litre.

Monty Sehgal, national spokesperson for the Federation of All India Petroleum Traders, said Octane 95 now represents more than 12% of sales.

The federation represents more than 80,000 petrol pumps.

Interest in Octane 100 has also increased.

Octane 100 is ethanol-free and contains more additives, but actual sales remain small because of limited availability and a price of around ₹160 to ₹170 per litre.

Retailers estimate it accounts for around 1% of petrol sales.

Diesel-car sales increased to 71,385 units in July 2026 from 64,853 in June.

Crude oil diversification

India is increasing crude-oil purchases from Latin America as the Iran conflict and disruptions around the Strait of Hormuz affect supplies.

Imports from Venezuela increased sharply in August.

Venezuela became India’s fourth-largest crude supplier.

LPG imports from Algeria

Indian Oil Corp. finalised a deal with Algeria’s Sonatrach to import LPG in 2027.

IOC is expected to receive one very large gas carrier every month.

Each shipment will contain around 45,000 to 55,000 metric tonnes of LPG.

Transport infrastructure outlook

India Ratings and Research maintained a neutral outlook on India’s transportation infrastructure sector.

It expects the sector to perform reasonably well through the rest of FY27 despite global disruptions and economic volatility.

National highway toll collections are expected to grow 7% to 7.5% in FY27.

Traffic is expected to grow 4% to 4.5%.

Within Ind-Ra’s portfolio:

• Toll income grew 10.3% year-on-year in FY26.
• Toll income grew 8% in Q1FY27.

Delhi Master Plan

Delhi plans to build 4 million new homes.

The city also plans to distribute its population more evenly as it prepares for another 8 million residents by 2047.

The targets are part of the capital’s new Master Plan.

Battery-storage self-sufficiency

India may require another 10 years to become self-sufficient in battery storage.

The main gap is between demand and domestic manufacturing capability for important battery-cell components.

This means India remains structurally dependent on imports.

Other policy and appointments

Hair-transplant clinic rules

India introduced guidelines for hair-transplant clinics after concerns about failed procedures, medical complications and deaths.

The rules were finalised by an expert committee under the Directorate General of Health Services.

Clinics will need:

• Qualified medical staff.
• Surgical-grade facilities.
• Emergency preparedness.

Centres that fail to follow the rules can face penalties of up to ₹5 lakh.

Operators can also face prosecution under other laws depending on the offence.

India’s hair-transplant market is estimated at $307.83 million.

India-Japan defence ties

India and Japan agreed to strengthen security ties, including maritime cooperation.

Defence Minister Rajnath Singh and Japanese Defence Minister Shinjiro Koizumi signed a memorandum on maritime security cooperation in New Delhi.

RBI board appointments

Former ISRO chairman S. Somanath was appointed to the RBI’s central board as a part-time, non-official director for four years from 20 August 2026.

Anand Mahindra was reappointed for another four years in the same type of role.

Corporate action and earnings

Earnings and results

Q1FY27 earnings across Indian companies

Indian corporate earnings were stronger than expected during the June quarter, but performance differed sharply by company size.

Nifty 50 profits grew nearly 18% year-on-year.

This was around twice the Street estimate of 9%.

A Mint analysis of 2,774 non-financial companies found:

• Nominal revenue growth of 21% year-on-year.
• Inflation-adjusted real revenue growth of nearly 17%.

Both were the strongest in three years.

The difference between nominal and real growth means both higher volumes and better pricing or realisations helped reported revenue.

A separate analysis of 3,271 companies showed:

• Large companies with revenue above ₹10,000 crore had 17% revenue growth, a three-year high, but profit growth of only 2%.
• Oil marketing companies recorded a combined loss of ₹18,100 crore, compared with profit of ₹16,200 crore a year earlier.
• Medium-sized companies with revenue of ₹1,000 crore to ₹10,000 crore recorded 16% revenue growth and 24% profit growth, the strongest profit growth in six quarters.
• Small companies, which make up nearly 90% of India Inc. but only around 10% of total profits, recorded profit growth of only 5%.

Hindalco’s revenue rose 26% year-on-year as aluminium prices increased because of supply deficits and strong renewable-energy demand.

ONGC’s revenue rose nearly 46% as the West Asia war pushed crude prices to around $90 to $100 per barrel during the quarter.

Hindalco’s profit nearly tripled, while ONGC’s profit doubled from a year earlier.

MRF

MRF’s standalone Q1FY27 revenue rose 10% year-on-year to ₹8,291.56 crore.

Demand from replacement buyers and original equipment manufacturers helped growth, along with measured price increases.

Revenue still missed consensus estimates.

Adjusted profit after tax fell 2% to ₹474.37 crore.

Other income rose 53% to ₹191.48 crore and helped protect profit.

EBITDA fell 8% year-on-year to ₹948.6 crore.

Gross margin fell 570 basis points from the previous quarter to 32.7% because of higher input costs.

Anand Rathi Share and Stock Brokers expects MRF’s raw-material basket to rise another 8% to 10% in Q2FY27.

Ceat and Apollo Tyres recorded Q1FY27 revenue growth of 18% and 16%.

However, gross margin declined sequentially by:

• 620 basis points for Ceat.
• 550 basis points for Apollo Tyres.

MRF shares are down 13% in 2026.

The stock trades at around 20 times estimated FY28 earnings.

Glenmark Pharmaceuticals

Glenmark received US FDA approval for its generic version of fluticasone propionate nasal spray.

The product is used to treat rhinitis.

It targets the Flonase nasal-spray market, which recorded approximately $295 million of US sales during the 12 months ending June 2026.

Swiggy and Instamart

Swiggy shares gained 2% across two trading sessions after shareholders approved a change that allows the company to become Indian-owned and controlled.

Swiggy lowered its foreign-ownership cap to 49.5% from 50.02% in June.

The change allows quick-commerce business Instamart to operate an inventory-owned model alongside its existing marketplace for third-party sellers.

Instamart remains loss-making at the adjusted EBITDA level.

Its Q1FY27 adjusted EBITDA loss fell:

• 13% year-on-year.
• 9% from the previous quarter.

The loss was ₹778 crore.

Net order value, which means gross order value minus discounts, rose:

• 39% year-on-year.
• 3% sequentially.

Net order value reached ₹5,817 crore.

Emkay Global Financial Services values:

• Swiggy’s food-delivery business at ₹57,000 crore using 32 times FY28 EV/EBITDA.
• The out-of-home and supply-chain business at ₹6,500 crore.
• Cash on hand at ₹15,000 crore.

Swiggy’s current market capitalisation was ₹77,000 crore.

After deducting the value of those three items, Emkay’s calculation gives Instamart an implied valuation of negative ₹1,500 crore.

Deals and stake sales

Larsen & Toubro

Larsen & Toubro secured its third consecutive major order.

The order is worth up to ₹5,000 crore.

L&T will design and build an Automated People Mover system for Phase 1 of Dubai’s Al Maktoum International Airport.

The project will be executed with Japan’s Mitsubishi Heavy Industries.

TPG and Aster DM Quality Care

TPG sold a 6.66% stake in Aster DM Quality Care through an open-market transaction.

The average sale price was ₹766.17 per share.

The total transaction value was ₹4,451.45 crore.

Adfactors PR

Adfactors PR acquired a majority stake in Australian communications consultancy SenateSHJ.

Financial terms were not disclosed.

SenateSHJ will keep its brand, leadership and client teams and continue operating from Sydney and Melbourne.

Euler Motors and Hero MotoCorp

Euler Motors has doubled sales and revenue and added manufacturing capacity since Hero MotoCorp invested in the company.

Hero has invested ₹720 crore in Euler.

It was Euler’s largest shareholder with a 34% stake at the end of FY26.

Euler sold 6,528 vehicles in FY26, up 87%.

It has already sold 5,318 vehicles during the first four months of FY27.

Revenue rose 101% to ₹433 crore in FY26.

Losses increased to ₹315 crore from ₹261 crore.

Hero has also invested around ₹2,600 crore in Ather.

This includes its latest ₹960 crore investment through preference shares.

Hero’s 29.2% stake in Ather is currently valued at around ₹16,000 crore.

Sector and company trends

Aditya Birla Capital enters gold loans

Aditya Birla Capital entered the gold-loan business.

The company plans to open 200 to 300 dedicated branches by March 2027.

It aims to reach around 1,000 gold-loan branches over the next three years.

In Q1FY27:

• Assets under management rose 28% year-on-year to ₹1,67,456 crore.
• Disbursements increased 34% to ₹21,201 crore.

Gold loans are growing quickly across NBFCs.

Outstanding NBFC loans against gold jewellery reached ₹3.42 trillion at the end of June 2026.

This was 69.3% higher than ₹1.44 trillion a year earlier and was the fastest growth among major lending categories.

IndiGo

IndiGo increased its domestic market share to a record 67.4% in July.

Akasa Air’s share fell to 5.5% from 6.4% in June.

SpiceJet’s share fell to 1.6% from 1.9%.

Air India Group remained around 24%.

Indian airlines carried around 12 million passengers in July.

This was:

• 5% lower than a year earlier.
• 11% lower than June, when traffic was 13.5 million.

The sequential decline followed a year-on-year fall of more than 12% in June.

IndiGo has firm orders for 60 Airbus A350-900 aircraft.

Deliveries are scheduled to begin next year.

The airline expects international flights to represent around 40% of total capacity by FY30, up from around 30% now.

International capacity increased from 15% of IndiGo’s total in FY22 to 32% in FY26.

IndiGo currently owns no widebody aircraft, although it has six on lease from Norse Atlantic Airways.

The airline said in July that it will stop operating the Boeing 787-9 aircraft and end its damp-lease agreement with Norse Atlantic Airways at the end of October.

IT-company employee pyramids

Since the start of FY27, seven of India’s 10 largest IT-services companies have announced changes to their employee structures.

Cognizant, Tech Mahindra and Sonata Software want to broaden the lower part of the employee pyramid.

Wipro, LTM and Coforge are trying to expand the middle.

TCS is restructuring its workforce around skills rather than years of experience.

Cognizant ended its latest year with revenue of $21.1 billion, up 7%.

Tech Mahindra ended FY26 with revenue of $6.39 billion, up 2%.

Sonata Software reported FY26 revenue of $1.21 billion, up 1%.

Wyndham Hotels

Wyndham Hotels & Resorts plans to increase its India network from 96 hotels to around 200 by 2028.

The company expects to cross 100 hotels before the end of 2026.

Road and airport development in smaller Indian cities is helping travel and hospitality demand.

Wyndham reported global annual revenue of $1.24 billion in 2025.

Alstom and Indian Railways

Indian Railways and Alstom formed a joint venture in 2015 to manufacture 800 electric freight locomotives in Madhepura, Bihar.

Alstom is discussing another order for 200 locomotives.

The original 800-locomotive order is expected to be completed by March 2028.

Around 650 locomotives have already been delivered.

D2C funding

Investors are raising the revenue levels they expect from direct-to-consumer brands before providing funding.

At the seed stage, investors are increasingly looking for annual revenue of around ₹2 crore to ₹3 crore.

Earlier, the expected level was closer to ₹1 crore.

Funding for Series A and later rounds fell from $416 million in H1 2025 to $280 million in H1 2026.

The number of deals fell from 47 to 38.

Startup lending by banks

Traditional banks are lending more to startups as more new-age companies become profitable and produce steadier cash flow.

HSBC India has already deployed more than half of the $1 billion of startup debt capital it announced in 2025.

Axis Bank has built a new-economy loan book of nearly ₹3,000 crore over the past five years.

Typical borrowing costs differ by lender:

• Traditional bank: Around 10% or lower in some cases.
• Venture-debt provider: Around 14% to 18%.
• Mid-market lender or NBFC: Around 13% to 16%.

Apparel brands and Gen Z

Older Indian apparel brands are creating sub-brands to attract younger buyers.

Examples include:

• Peter England: VYBE.
• BIBA: BIBA NXT.
• Libas: Gerua.

Gerua sales have increased 85% since its launch in April 2025.

Repeat purchases are at 45%.

The collection has contributed 22% of Libas’ new customers.

Satellite launch costs

A peer-reviewed article in the September edition of Economics Letters compared satellite launch costs across countries.

At the end of 2025, launch costs per kilogram were:

India’s reported cost was more than four times the US figure.

The study was written by Alessio Terzi of the University of Cambridge and Francesco Nicoli of the Politecnico Institute of Turin.

Markets and fund flows

Mutual fund holdings

A Mint analysis of ACE Equity data covering 4,367 BSE-listed companies found that mutual funds increased holdings in nearly two-thirds of large- and mid-cap companies during the June quarter.

Foreign portfolio investors reduced holdings in a majority of companies in both segments.

Among 95 large-cap companies:

• Mutual funds increased holdings in 66.3%, up from 58.9% in the previous quarter.
• Mutual funds reduced holdings in 32.6%.
• FPI holdings fell in 68.4%, up from 53.7% in the previous quarter.
• FPI holdings rose in 31.6%.

During Q1FY27:

• Small-caps gained 29.1%.
• Mid-caps gained 17.2%.
• Large-caps gained 8.9%.

Equity mutual funds received ₹1.5 trillion of net inflows between April and July.

Small-cap schemes received around ₹38,000 crore during 2026 through July, slightly more than during the same period last year.

Sriram B.K.R. of Geojit Financial Services linked the trend to steady domestic equity inflows, especially through systematic investment plans.

Tanvi Kanchan of Anand Rathi Shares & Stock Brokers distinguished between domestic flows helping the market and flows being strong enough to cause a valuation re-rating.

Individual derivatives traders

Individual equity-derivatives traders recorded total losses of ₹91,685 crore in FY26.

This was slightly below ₹1.12 trillion in FY25.

However, average loss per trader increased 2%, from ₹1.13 lakh to ₹1.17 lakh.

The share of individual traders who lost money fell from 90.9% to 87.7%.

The number of individual derivatives traders fell for the first time since FY16.

Participation declined 18% to 8.771 million traders.

Traders active for more than 100 days generated:

• 94% of turnover.
• 87% of total losses.

Their average loss was ₹2.76 lakh.

Traders who were active for 100 days or fewer lost an average ₹22,000.

Around 93% of traders were classified as “only options buyers”.

Another 4% were “majorly options buyers”.

Around 77% used peak margin of less than ₹1 lakh.

NSE may seek trading of its shares on NSE

NSE may seek permission to allow its own shares to trade on its platform after first listing them on BSE.

Existing rules do not provide for a stock exchange to list on itself.

NSE is a market infrastructure institution and would need SEBI approval.

Gaja Alternative Asset Management IPO

Gaja Alternative Asset Management’s ₹550 crore IPO was subscribed 2.43 times by the end of the second day.

Investors bid for 6,16,66,998 shares against 2,53,28,946 shares on offer.

Subscription by category was:

• Non-institutional investors: 3.93 times.
• Retail investors: 3.13 times.
• Qualified institutional buyers: 10%.

The company operates under the Gaja Capital brand.

It raised ₹165 crore from anchor investors on Tuesday.

Nippon India Mutual Fund and Invesco Mutual Fund invested ₹30 crore each.

HDFC Life and SBI Life were also part of the anchor book.

The IPO closes on 21 August.

The price band is ₹152 to ₹160 per share.

Regulatory and legal

SEBI enforcement activity

Fresh adjudication proceedings started by SEBI fell to 135 in FY26.

This was a decade low.

The number was:

• 204 in FY25.
• 249 in FY16.

Adjudication orders against registered intermediaries fell to 88 from 116.

SEBI also issued:

• 62 final orders in FY26, down from 89.
• 15 interim orders, down from 26.

At the same time, investigative activity increased in some areas.

SEBI completed:

• 202 insider-trading investigations, up from 192.
• 72 investigations into suspected price and volume manipulation, up from 61.
• 49 front-running investigations, up from 44.

Niva Bupa

Irdai barred Niva Bupa Health Insurance from opening new places of business for six months.

The action relates to a breach of business-expense limits.

Health-insurance expenses should not exceed 35% of gross written premiums during a financial year.

Niva Bupa shares extended losses and closed 1.3% lower after the announcement.

Upcoming events

Economic calendar

Global pulse

Global markets

Most major global markets ended higher.

The Nikkei 225 rose 1.36%, while the Hang Seng gained 0.85%.

The S&P 500, Dow Jones, Nasdaq 100 and Shanghai Composite also moved higher.

The FTSE 100 fell 0.23%.

US public debt and Treasury buybacks

US public debt crossed $40 trillion for the first time.

Total debt reached $40.05 trillion.

This included:

• $32.27 trillion of Treasury securities held by the public.
• $7.78 trillion of intragovernmental debt.

The level has increased concerns about rising interest costs, social-program spending and persistent fiscal deficits.

The US Treasury doubled the size of buybacks for long-duration government debt.

The move was intended to help the bond market after a sharp sell-off pushed the 30-year Treasury yield to its highest level since 2007.

The recent rise in yields was linked to Middle East tension, inflation and concerns about the US fiscal outlook.

Crude oil

Brent crude rose more than 2% to around $93.80 per barrel.

This was its highest level since 24 July.

The move came after US President Donald Trump announced new economic measures targeting Iran.

Bitcoin

Bitcoin rose nearly 11% over 24 hours to around $71,730.

This was its highest level in two months.

The move added nearly $190 billion to total crypto market capitalisation.

Sentiment improved after President Trump called on Congress to pass the Crypto CLARITY Act while speaking to technology and crypto executives.

The comments increased optimism about a clearer US regulatory framework for digital assets.

US pressure on Iran

President Trump said he would launch what he called “ECONOMIC D-DAY” against Iran.

He said the US would begin a major economic campaign against Iran and entities that do business with the country.

He did not specify what measures would be added to existing sanctions.

The announcement came as talks over reopening the Strait of Hormuz and ending the nearly six-month war remained stalled.

UAE cuts economic ties with Iran

The United Arab Emirates suspended financial and economic transactions with Iran.

The move could reduce Iran’s access to a major source of imports and a route into the international financial system.

The action followed weeks of US pressure on the UAE to restrict Iranian financial networks.

Before the war, the UAE was Iran’s largest source of imports ahead of China.

In 2024, the UAE supplied more than 30% of Iran’s imports, worth around $21 billion.

The US Treasury said $9 billion passing through correspondent accounts maintained by US banks in 2024 appeared to be linked to hidden Iranian financial activity.

Around 62% of those funds went to UAE-based companies, mostly in Dubai.

The UAE action also followed military tension.

Emirati officials said Iran had attacked seven UAE ships during August.

The UAE also said Iran fired two ballistic missiles towards the country on Tuesday.

Its defence ministry said the missiles were aimed at maritime traffic and fell into the sea.

Strait of Hormuz talks expire

The 60-day period set in a June memorandum of understanding between the US and Iran expired on Monday.

No agreement was reached to fully reopen the Strait of Hormuz or end the conflict.

Around 20% of the world’s oil supply passes through the waterway.

Kuwait during the Iran war

As the conflict approaches its seventh month, Kuwait is focusing on keeping its economy operating.

Kuwait Petroleum Corp.’s waterfront headquarters remains empty and damaged by a drone strike.

After a fire in April, employees were moved around 40 km away to alternative offices in southern Kuwait.

By the end of July, Kuwait Petroleum Corp. was signing a $16 billion pipeline deal with North American companies.

The transaction is described as the largest foreign direct investment in Kuwait’s history.

An International Institute for Strategic Studies report published during the first weeks of the war said Kuwait was the most targeted Arab state after the UAE.

It was targeted more than Saudi Arabia and Qatar combined.

Russia-Ukraine war

Russia launched a large missile and drone attack on Kyiv and the surrounding region.

At least 16 people were killed.

Fifteen died in Kyiv and one in the wider Kyiv region.

Around 40 people were injured.

Hits were recorded at 28 locations across Ukraine.

More than 38,000 people, including more than 2,000 children, sheltered overnight in Kyiv subway stations.

Russia’s defence ministry said its air defences shot down 726 Ukrainian drones over Russian regions, annexed Crimea and the Black and Azov seas.

This was one of Ukraine’s largest aerial attacks of the war.

The United Nations said Kyiv was one of the cities hit hardest in July, with at least 54 civilians killed and 202 injured.

A Russian attack just over two weeks earlier killed 17 people in Kyiv and the surrounding region.

Another attack two days before that killed nine people in the city.

Ukraine’s intelligence agency said Russia can produce more than 200 cruise and ballistic missiles each month.

It said Russia has stockpiled:

• More than 1,100 cruise missiles.
• Around 130 Iskander-M ballistic missiles.

Ukraine’s general staff said its forces attacked:

• An oil refinery in Nizhnekamsk, Tatarstan.
• The Tamanneftegaz oil terminal in Volna, Krasnodar region.

Evergrande founder sentenced

Hui Ka Yan, founder of Evergrande, was sentenced to life in prison.

The companies involved were fined more than $2 billion.

A Shenzhen court convicted Hui, 67, and Evergrande of large-scale financial fraud involving inflated assets and hidden liabilities.

The Evergrande group was fined 8.82 billion yuan, or $1.31 billion.

Evergrande Real Estate Group was fined 7 billion yuan, or $1.04 billion.

Evergrande had collapsed with more than $300 billion in liabilities after China tightened rules on excessive real-estate borrowing in 2020.

More than 50 other people were sentenced to prison terms ranging from 22 months to 18 years.

Luxury sales in China

Sales at China’s 25 largest luxury brands fell more than 10% in July.

The slowdown was worse than in June.

Brands recording double-digit sales declines included:

• Louis Vuitton.
• Dior.
• Gucci.
• Bottega Veneta.
• Balenciaga.

Hermès moved from growth to decline.

The weakness comes as China tightens controls on capital leaving the country and seeks taxes on offshore assets and investment gains.

The MSCI China Index rose 28.3% last year but is down 8.9% this year.

Chinese retail-sales growth slowed to 0.6% last month.

Sales of jewellery and cars fell more than 10%.

LVMH shares were down around 1% in Paris.

Kering and Hermès were both around 0.6% lower.

Walmart

Walmart shares fell 6% in premarket trading.

US comparable sales grew 2.6%, below expectations of 3.8%.

Higher petrol prices reduced consumer spending.

However:

• US e-commerce sales rose 24%.
• Walmart Connect advertising revenue increased 43%.

Walmart raised its FY27 net-sales growth forecast to 4% to 5%.

Estée Lauder

Estée Lauder Companies reported June-quarter revenue of $3.6 billion.

The result was above analyst estimates.

The company’s turnaround efforts continued to improve.

Moderna short sellers

Moderna shares rose 177% on Wednesday after positive late-stage cancer-vaccine results.

The estimated mark-to-market loss for short sellers was $5.5 billion.

Smartphone shipments in India

India shipped 64.2 million smartphones during the first half of 2026.

This was the lowest first-half level in five years.

Amazon fine

The Central Consumer Protection Authority fined Amazon Seller Services ₹100,000.

The action related to commercial sweets sold online under the label “Shri Ram Mandir Ayodhya Prasad”.

Management commentary

Tata Consumer Products reported 12% revenue growth, 19% EBITDA growth and a 29% increase in net profit in the June quarter. The company expects to maintain double-digit revenue growth in FY27.

Feature: SEBI’s mutual fund classification framework

How the classification system developed

In October 2017, SEBI required mutual fund schemes to be placed into standard categories.

The aim was to reduce the number of similar funds with different names and make schemes easier to compare.

SEBI said schemes from the same category should be clearly similar in their main characteristics, while different schemes from the same fund house should be distinct in their asset allocation or investment strategy.

The framework generally allowed only one scheme per category for each mutual fund.

Exceptions included:

• Index funds and ETFs tracking different indices.
• Fund of funds investing in different underlying schemes.
• Sectoral and thematic funds investing in different sectors or themes.

Under the 2017 framework, AMFI classified schemes into:

• Equity schemes.
• Debt schemes.
• Hybrid schemes.
• Solution-oriented schemes for retirement and children.
• Other schemes, including index funds, ETFs and fund of funds.

AMFI also states that scheme naming, particularly for debt funds, should reflect the risk of the underlying portfolio. One example is the change from “Credit Opportunity Fund” to “Credit Risk Fund”.

What changed on 26 February 2026

SEBI introduced a new classification framework through circular HO/24/13/15(2)2026-IMD-RAC4/I/5764/2026 dated 26 February 2026.

The earlier framework came from SEBI circulars issued on 6 October 2017 and 6 November 2020 and had later been consolidated into the Master Circular for Mutual Funds dated 27 June 2024.

The 2026 circular replaced clause 2.6 of the earlier Master Circular.

SEBI said the change was needed because the investment landscape had evolved and new opportunities had appeared across asset classes.

Under the new framework, mutual fund schemes are broadly classified into:

• Equity schemes.
• Debt schemes.
• Hybrid schemes.
• Life Cycle Funds.
• Other schemes, including fund of funds and passive schemes such as index funds and ETFs.

The old solution-oriented category was discontinued.

The circular defines the “residual portion” as the part of a scheme’s assets that is not invested in its main core asset classes.

Equity schemes: 13 categories

An equity scheme is a mutual fund scheme that invests mainly in equity and equity-related instruments.

Large-cap, mid-cap and small-cap definitions follow clause 2.7 of the Master Circular.

AMFI prepares the standard stock list used for these definitions.

The residual portion of equity schemes may be invested in:

• Equity.
• Money-market and other liquid instruments.
• Gold and silver instruments allowed by SEBI.
• InvITs.

These allocations remain subject to the applicable regulatory limits.

Portfolio-overlap limit

The new framework introduces a 50% ceiling on portfolio overlap in some categories.

A mutual fund may offer both a Value Fund and a Contra Fund only if the overlap between the two portfolios is not more than 50%.

For sectoral and thematic schemes, no more than 50% of a scheme’s portfolio may overlap with other sectoral or thematic equity schemes or other equity categories.

Large-cap schemes are excluded from this comparison.

Overlap is measured quarterly using the average of daily portfolio-overlap values.

The calculation is done at the individual ISIN level.

Only securities held by both schemes are included.

For each common security, the lower of the two portfolio weights is used.

Existing sectoral and thematic funds have three years from 26 February 2026 to meet the limit.

The adjustment path is:

• Year 1: Realign 35% of excess overlap.
• Year 2: Realign another 35%.
• Year 3: Realign the remaining 30%.

Schemes that still fail to meet the requirement after three years must be merged with other schemes under the applicable rules.

Sectoral and thematic funds must also follow a list of sectors and themes published and updated by AMFI in consultation with SEBI every six months.

Debt schemes: 17 categories

A debt scheme invests mainly in debt and debt-related instruments.

The new system contains 17 categories, mainly based on portfolio duration or the type and credit quality of issuers.

Permitted sectors for sectoral debt funds are:

• Financial services.
• Energy.
• Infrastructure.
• Housing.
• Real estate.

Macaulay duration and debt-fund rules

The scheme information document must explain Macaulay duration.

Duration is measured at the portfolio level.

Debt funds may invest in instruments such as:

• Treasury bills.
• Government securities.
• Debentures.
• Commercial paper.
• Certificates of deposit.

For Medium Term and Medium to Long Term Funds, managers may reduce duration during an anticipated adverse interest-rate environment.

Medium Term Funds can reduce duration to as low as one year.

Medium to Long Term Funds can also reduce duration to as low as one year.

The AMC must explain these adverse-situation allocations in the scheme information document.

If duration is reduced below the normal minimum of three years or four years, the AMC must:

• Record the reason and justification.
• Keep it available for inspection.
• Present it to trustees at the next trustee meeting.
• Include the review in the half-yearly trustee report to SEBI.

A sectoral debt fund can be offered only if enough investment-grade debt is available in that sector.

Normal sector-exposure limits under clause 12.9.1 of the Master Circular do not apply to these sectoral debt funds.

Hybrid schemes: 7 categories

A hybrid fund mixes different asset classes such as equity, debt, InvITs and commodity-linked instruments allowed by SEBI.

The residual portion of hybrid schemes may be invested in InvITs, except for arbitrage funds.

They may also invest in ETCDs, Gold ETFs and Silver ETFs within regulatory limits.

Foreign securities do not count as a separate asset class.

AMFI describes hybrid funds as combining growth from equity with income and stability from debt.

The Scheme Information Document states how much equity and debt the portfolio may hold.

Higher equity exposure generally means higher risk.

Solution-oriented schemes discontinued

The separate solution-oriented category was discontinued from 26 February 2026.

Existing schemes in this category had to stop accepting new subscriptions immediately.

These funds must be merged with another scheme that has a similar asset allocation and risk profile, with prior SEBI approval.

AMFI’s Investor Corner page, as published, continues to list the older solution-oriented retirement and children’s categories under the 2017 framework.

Life Cycle Funds: a new category

The 2026 framework creates a new Life Cycle Fund category.

These funds follow a pre-set glide path across asset classes such as:

• Equity.
• Debt.
• InvITs.
• Exchange-traded commodity derivatives.
• Gold ETFs.
• Silver ETFs.

The standard description is:

“an open ended fund with attributes of pre-determined maturity and glide path for goal based investing”

Life Cycle Funds can have a minimum tenure of 5 years and a maximum of 30 years.

Tenures must be in multiples of five years.

A mutual fund can have a maximum of six Life Cycle Funds open for subscription at one time.

When a fund has less than one year to maturity, it may be merged with the nearest-maturity Life Cycle Fund if unit holders give positive consent.

Life Cycle Fund asset allocation

For a 30-year Life Cycle Fund, the prescribed ranges are:

For funds with 25-year, 20-year, 15-year, 10-year or 5-year maturities, the corresponding shorter parts of the same schedule apply.

Debt investments must be rated AA or above and have residual maturity below the scheme’s target maturity.

ETCD exposure can only be linked to gold or silver.

When less than five years remain, Life Cycle Funds can also take equity-arbitrage exposure of up to 50% in addition to the listed equity range.

However, total equity and equity-related exposure must remain between 65% and 75% in these schemes.

Life Cycle Fund exit loads

Life Cycle Funds have specific exit loads intended to encourage long-term holding.

• Exit within one year: 3%.
• Exit within two years: 2%.
• Exit within three years: 1%.

Life Cycle Funds follow the benchmark framework used for Multi Asset Allocation Funds.

The maturity year must appear in the fund’s name.

Examples include:

• Life Cycle Fund 2055.
• Life Cycle Fund 2045.

Passive funds and fund of funds

Fund of Funds structure

For FoFs investing in multiple underlying funds, SEBI refers to the framework issued to AMFI on 30 June 2025.

It contains six broad categories:

• Equity-oriented FoF, Domestic.
• Debt-oriented FoF, Domestic.
• Hybrid FoF, Domestic.
• Commodity-based FoF, Domestic.
• Overseas FoF.
• Domestic and Overseas FoF.

Each category may have:

• An Active option investing in multiple active funds.
• A Passive option investing in multiple passive funds.
• An Active and Passive option.

FoFs must invest at least 95% of total assets in underlying funds.

The remaining portion cannot conflict with the scheme’s main strategy.

If a mutual fund already has more FoF schemes in a category than the new framework permits, those existing funds can continue.

However, the AMC cannot launch more FoFs in that sub-category.

Existing FoFs may also need to be aligned or re-categorised.

Fund of Funds expenses

A Fund of Funds has two layers of cost:

• The expenses of the underlying schemes.
• The expenses charged by the FoF itself.

Regulations cap the combined cost.

AMFI states:

• FoFs investing in liquid schemes, index funds and ETFs: TER capped at 1%.
• FoFs investing in equity-oriented schemes: TER capped at 2.25%.
• FoFs investing in other schemes: TER capped at 2%.

Index funds can charge fees of up to 1.5%.

ETFs are listed on stock exchanges and trade during the day like shares.

ETF units must be held in demat form.

Naming and true-to-label rules

SEBI wants fund names to make schemes easier to identify and compare.

The scheme name must generally match the scheme category.

Names cannot use words or phrases that highlight only potential returns.

The “type of scheme” shown below the scheme name in offer documents, advertisements and marketing material must follow SEBI’s prescribed description.

Clause 1.4.1 of the earlier Master Circular has been deleted.

Existing schemes must change their:

• Name.
• Investment objective.
• Investment strategy.
• Benchmark.
• Other relevant parameters.

These changes are meant to bring schemes in line with the new categories.

SEBI says these changes will not be treated as a fundamental attribute change.

Existing funds have six months from 26 February 2026 to comply.

Monthly portfolio-overlap disclosure

Mutual funds must publish category-wise portfolio overlap.

The required comparisons include:

• Equity scheme versus other equity schemes.
• Debt scheme versus other debt schemes.
• Hybrid scheme versus other hybrid schemes.

The information must be published every month on the AMC website.

The circular took effect on 26 February 2026.

It was issued under Section 11(1) of the SEBI Act, 1992 and Chapter VI-C of the SEBI Mutual Funds Regulations, 1996.

The circular is signed by Anupma Chadha, General Manager, Investment Management Department.

Size of the mutual fund industry

Indian mutual fund assets under management stood at ₹85,75,657 crore on 31 July 2026.

Average assets under management during July were ₹86,33,798 crore.

The industry first crossed ₹30 trillion of AUM in November 2020.

It crossed 10 crore folios in May 2021.

July 2026 SIP inflows reached ₹31,961 crore.

Active equity funds received net inflows of ₹24,697.39 crore.

Within equity categories:

• Small-cap funds received ₹7,767.50 crore.
• Mid-cap funds received ₹6,192.31 crore.
• Large-cap funds recorded an outflow of ₹1,321.69 crore.

AMFI data reported by ANI put total open-ended mutual fund AUM at ₹85.59 lakh crore on 31 July 2026.

Purpose of the new framework

The regulator’s stated direction is to make mutual funds more clearly “true to label”, reduce product clutter and limit cases where similar thematic portfolios are presented as different products.

The intended result is clearer categories, easier comparisons and fewer similar-looking schemes with different names.

Closing note

DayStarter by Devraj, 21 August 2026. Market data is from the Zerodha AfterMarket Report dated 20 August 2026. Macro, corporate and global sections are based on the Mint Mumbai print edition dated 21 August 2026 and the Zerodha AfterMarket Report. The feature section uses the SEBI circular dated 26 February 2026, AMFI, ICICI Direct / Capital Market Live News and Business Standard. This publication is a compilation of reported facts. It is not investment advice, and no recommendation to buy, sell or hold any security is made or implied.