Saugata Bhattacharya, external member of the monetary policy committee (MPC), discusses with Rozebud Gonsalves about the second-order impact of input costs, expected financial conditions after the new FCNR(B) deposit and external commercial borrowing (ECB) incentives, and the inflation-growth trade off. Edited excerpts.

With crude oil prices falling, would growth be better than the central bank forecast? If yes, then do you think that the need to hike rates is lesser?

Yes, RBI growth and inflation forecasts were based, among other assumptions, on crude oil prices averaging $95 / barrel, which, based on oil futures, now appear likely to be lower. However, disruptions in supply chains could persist for some time, and hence it is difficult to predict the extent of growth recovery in FY27.

The MPC minutes have said that second-order input cost transmission getting embedded in retail inflation will have to be monitored. What would be the first signs visible via data that would suggest visible impact?
Second order effects are likely to manifest in core (non-food and fuel) CPI components, particularly in underlying components (excluding precious metals), indicating the extent of higher input cost pass through to retail inflation. However, it is difficult to forecast second order effects of higher input costs, which will depend on demand elasticities, input substitution and other pass through variables.The RBI Governor’s statement noted a revised FY27 core inflation at 4.7%, up from 4.4% at the April review, and headline at 5.1%, up from 4.6%. Factoring in price trends in other components, it might be possible to estimate specific inflation components.

Are current financial conditions already restrictive enough that a rate hike is unnecessary?

Although the policy repo rate is currently only 15 basis points above the FY27 forecast CPI inflation, money market and short term interest rates remain higher. RBI has also maintained system liquidity at appropriate levels. In addition, the gap between the repo rate and longer term bond yields have also risen much beyond steady state levels. Although MPC quarter wise forecasts of CPI inflation peaks in Q3 FY27, close to the upper band of the target, underlying inflation remains much lower and there are little signs of the economy overheating.
Have conditions eased after the FCNR(B) and ECB packages? Would strong inflows from these schemes reduce the need for any future monetary tightening?
Prima facie, the expected foreign currency inflows will add to autonomous domestic liquidity if even some of the inflows are absorbed by the central bank to replenish its foreign currency reserves. However, financial conditions will depend on RBI’s system liquidity management.Can it be said that growth is a bigger concern for the RBI in the current scenario, especially since inflation is projected at 5.1% and the repo rate is at 5.25%?
At the time of the MPC review, there were risks to both inflation and growth. While high frequency indicators suggested continuing resilience, they indicated a loss of momentum. This was the reason FY27 GDP forecast was a lower 6.6%, compared to the then FY26 estimate of 7.6%.

Mumbai: Few IPO calendars have looked as momentous as the ones shaping up in the US and India. On one side are OpenAI and Anthropic, two mega companies looking to ride the AI frenzy following the jumbo SpaceX issue’s roaring success earlier in June. On the other are India’s long-awaited giant IPOs, Jio Platforms and NSE, which have been part of investors’ wish lists for years.

The biggest difference between the upcoming IPOs in India and the US is not their size but the market mood they are arriving in.

OpenAI and Anthropic are preparing to tap the primary market at a time when enthusiasm over AI has pushed US equities to record highs, creating an almost ideal backdrop for IPOs. In contrast, Jio and NSE are heading to the market in a far less ideal IPO milieu.

While OpenAI and Anthropic enjoy the luxury of launching their IPOs in a market where investors are looking to lap up anything linked to AI, Jio and NSE must do all the heavy lifting, as appetite for Indian equities is far from its peak.

This difference is consequential. Historically, mega IPOs have signalled market tops as issuers look to capitalise on investor frenzy. The logic here is that investors are willing to pay just about anything to be part of the euphoria, ignoring valuation concerns.

This theory, to some extent, resonates with what’s happening in the US, where the loss-making SpaceX listed at a record valuation of $1.8 trillion, making it one of the most valuable companies. Though SpaceX shares are stuttering after the blockbuster debut, the strong showing in the IPO has set the stage for OpenAI and Anthropic in the coming months. There is nothing, for now, to suggest that their IPOs would not sail through unless investors lose faith in the AI theme as a whole.
Shift focus to India: Jio and NSE are preparing to list at a time when Indian markets have delivered no or marginal returns in the past two years. While foreign investors have fled Indian stocks in large numbers, individual investors-the street’s current backbone-are showing less enthusiasm towards equities. Moreover, most recent listings have been far from inspiring.That’s good news for investors. The IPO valuations of both these issuances are likely to be far more sober, with fewer deviations from their listed peers and in sync with the overall large-cap space. Early indications suggest that global investors are considering deploying money in these IPOs, judging them on a standalone basis rather than as part of an India portfolio, given their dominant presence in sectors with high entry barriers.

Some optimists are counting on the Jio and NSE IPOs to give the secondary market a boost, the way Maruti Suzuki‘s IPO in 2003-04 proved to be a turning point for Indian markets. The carmaker’s IPO, coming after the dot-com bubble burst and in the aftermath of the Ketan Parekh scam, was credited with reviving retail participation in equities and improving investor sentiment, signalling the start of one of India’s best bull runs-between 2003 and 2007.

Whether Jio and NSE can have a similar effect is debatable, given the vastly different market and economic conditions prevailing today. Currently, the market is far more mature, with domestic equity ownership at record levels, creating less scope for the entry of a new army of domestic retail investors.

The real test for the Jio and NSE IPOs will not be whether they get fully subscribed; it will be whether the issues can rekindle foreign investor interest in Indian markets. Maruti’s IPO helped bring domestic investors back to the market. Two decades later, Jio and NSE face a bigger task: persuading global investors to give India another look.

The Nifty’s recent upmove could continue towards 24,300–24,600, though some near term consolidation is possible after the recent rally. Analysts see the 23,700–23,900 zone as key support and recommend buying on dips.

AMOL ATHAWALE

VP—TECHNICAL RESEARCH, KOTAK SECURITIES

Where is the Nifty headed? The weekly charts display a Doji candlestick pattern, signalling uncertainty and indecision between bulls and bears. Trading Strategy The short-term market outlook remains optimistic, with traders advised to buy on dips and sell on rallies. For the Nifty, the 50-day SMA around 23,850–23,750 is expected to act as a key support zone, while resistance is seen at 24,200–24,400. A fall below 23,750 may prompt traders to exit long positions.

TOP BETS FOR THE WEEK
Britannia Industries: Buy; CMP: Rs 5,195; stop loss: Rs 5,100; target: Rs 5,450

After finding support near Rs 5,050, the stock reversed and is undergoing positive consolidation near its 20-day SMA, indicating that the pullback may continue. Rs 5,100 is likely to act as a crucial support level, and sustaining above it could extend the move towards Rs 5,450.
Grasim Industries: Buy; CMP: Rs 3,150; stop loss: Rs 3,085; target: Rs 3,300
On both the daily and weekly charts, the stock remains in a strong uptrend, with Rs 3,090 emerging as a critical support level. As long as it stays above this mark, the rally could extend towards Rs 3,300, while a fall below Rs 3,090 may warrant an exit from long positions.

RUCHIT JAIN
HEAD – EQUITY TECHNICAL RESEARCH, MOTILAL OSWAL FINANCIAL SERVICES

Where is the Nifty headed? The Nifty has recovered steadily from the 23,000 mark, forming a higher bottom near the 61.8% Fibonacci retracement level and reclaiming its 50-day DEMA, signalling improving momentum. If the upmove sustains, the index could head towards 24,500, where the 200-day DEMA and a previous swing high may act as key resistance. On the downside, immediate support is placed at the 20-day DEMA near 23,700, and holding above this level would keep the short-term bullish bias intact.

Trading Strategy: Traders are advised to maintain a positive bias and use corrective declines to create fresh long positions. Dips towards 23,900–23,850 can be used as buying opportunities, with a stop loss below 23,700, while the Nifty may target 24,250 initially and 24,500 if momentum strengthens.

TOP BETS FOR THE WEEK
Aditya Birla Capital: Buy; CMP: Rs 376; stop loss: Rs 360; target: Rs 405
The stock is on the verge of breaking out of a sixmonth consolidation range, suggesting a continuation of its broader primary uptrend. A decisive breakout could trigger fresh momentum and attract follow-up buying.

Premier Energies: Buy; CMP: Rs 1,080; stop loss: Rs 1,020; target: Rs 1,180.
The stock has been forming a higher-top, higher-bottom structure. Prices are respecting the support range of the 20- and 50-day DEMAs, while the RSI oscillator indicates positive momentum.

PABITRO MUKHERJEE
DEPUTY VICE PRESIDENT— TECHNICAL, BAJAJ BROKING

Where is the Nifty headed?
The bias remains positive, and the Nifty is expected to extend its upmove towards 24,300 and 24,600 in the coming weeks. While some consolidation after the recent 1,100-point rally cannot be ruled out, dips towards the 23,800–23,900 support zone should be used to accumulate quality stocks. The broader market is likely to continue outperforming, with the Nifty Midcap 100 targeting 63,500 and the Nifty Smallcap 100 moving towards its CY25 high of 19,225. Trading Strategy Buy Nifty futures at current levels and on dips towards 23,900 for targets of 24,300 and 24,600.

TOP BETS FOR THE WEEK

Bharat Electronics: Buy; CMP: Rs 427; stop loss: Rs 411; target: Rs 452
The stock has broken out above the falling channel that contained its two-month decline and has also closed above its 20- and 50-day EMAs, offering a fresh entry opportunity. The stock is likely to gradually move towards Rs 452, which marks the 80% retracement of the previous decline from Rs 464 to Rs 399.

Eternal: Buy; CMP: Rs 264; stop loss: Rs 249; target: Rs 290
The stock is on the verge of breaking out above its eight week consolidation range of Rs 234–265, offering a fresh opportunity. A bullish crossover of the 20-day EMA above the 50-day EMA supports positive bias, with the stock expected to move towards Rs 290–295 in the coming months.

Mumbai: Foreign investors‘ derivatives bets continue to signal caution on Indian equities despite a slowdown in their cash-market selling, as uncertainty around the fragile US-Iran peace deal, a weak rupee and more attractive opportunities in other Asian markets keep sentiment subdued.

The Nifty gained 1.65% last week. However, the long-short ratio of foreign portfolio investors’ positions in Nifty futures-a measure of bullish bets relative to bearish ones-stood at 12.95% on Friday. While the increase in the ratio from 8.1% two weeks earlier shows some reduction in short positions, the reading remains far too high to conclude that foreigners have turned bullish.

In the cash market, foreign investors were net buyers in four of the five trading sessions last week, purchasing shares worth a net ₹7,778 crore.

“The long-short ratio has improved marginally due to some short covering alongside fresh long additions by FIIs following the US-Iran peace deal. However, the benchmark Nifty index has not shown an over-optimistic reaction to the peace deal,” said Vipin Kumar, AVP- derivatives and technical research at Globe Capital Market.

Iran said it was once again closing the vital Strait of Hormuz on Saturday over Israeli attacks in Lebanon ahead of the weekend negotiations between Washington and Tehran to end the West Asia conflict, underscoring the fragility of the talks.

Analysts said Indian equities are yet to become compelling enough for overseas investors.
“While crude has been correcting, levels of $80 are still high. A dip to $70 or pre-war levels can be a tailwind driving covering from funds that are running short positions in India,” said Sriram Velayudhan, senior vice president, IIFL Capital Services.Velayudhan also said that other regions like South Korea and Taiwan have not yet seen a meaningful reversal or underperformance.

South Korea’s Kospi is up 110% in 2026 so far, while Taiwan’s Taiex Index has gained 58% this year, compared with the Nifty’s decline of 8.2%.

Kumar said the rupee’s underperformance against the dollar and the risk of higher inflation due to a below-average monsoon forecast remain key concerns.

Where will the markets go?
The Nifty ended the previous week at 24,013.10.

Kumar said the index continues to trade within a range, with positional resistance around the 24,600 level.

“A positive weekly breakout in the Nifty index above the 24600 spot level on a closing basis, alongside improvement in the concerned areas, might trigger significant short covering by FIIs,” he said.

Velayudhan said that while the Nifty has been trading in a broad range of 23,800-24,500 for some time, it could test the upper end of that band in the near term.

Mumbai: Private equity major Carlyle plans to launch a $500 million initial public offering (IPO) for its Indian automotive platform, Highway Roop Precision Technologies, multiple people aware of the listing proposal told ET. In parallel, Carlyle has also initiated the IPO process for its healthcare revenue cycle management (RCM) platform, investment bankers said.

The proposed listings are likely by mid-2027, said the people cited above. The automotive platform is expected to be valued at about $2 billion.

The healthcare RCM asset, created through the merger of Knack RCM and EqualizeRCM after their acquisitions by the private equity major, should raise $400-500 million through a combination of primary and secondary share sales, bankers cited above told ET.

Investment bankers have begun pitching for mandates on both offerings. One of the most active private equity investors in India, Carlyle has deployed more than $8 billion in the country across investments including PNB Housing Finance, SBI Cards, VLCC, Hexaware Technologies and Nido Home Finance.

A Carlyle spokesperson declined to comment.

In February 2025, Carlyle Asia Partners acquired controlling stakes in Highway Industries and Roop Automotives, leading manufacturers of forged and precision-machined components, steering system assemblies, transmission parts and other powertrain applications used in electric, hybrid and internal combustion engine (ICE) vehicles. To lead the combined platform, Carlyle appointed Dharmesh Arora, former Asia-Pacific CEO of Schaeffler Group, as chief executive officer in June 2025.
The founders of Highway Industries and Roop Automotives, Umesh Munjal and Mohit Oswal, respectively, continue to hold a combined 25-30% stake in the merged entity. According to sources, Highway Roop is expected to generate revenue of about ₹3,000 crore and EBITDA of ₹700 crore in FY27.Precision Parts
In India, Highway Roop mainly competes with listed precision engineering and auto-component manufacturers such as Bharat Forge (Market cap of ₹97,652 cr), and Sona BLW Precision Forgings ( Market cap of ₹38,180 cr).

Separately, Carlyle Asia Partners acquired majority stakes in Knack RCM and EqualizeRCM in May 2026 to create a global, multi-specialty healthcare revenue cycle management platform. The combined business posted revenue of approximately $160 million and EBITDA of $65 million in FY26, sources said.