Motilal Oswal has initiated coverage on Tata Capital with a ‘Neutral’ rating and a target price of Rs 390, valuing the stock at 2.7x its estimated March 2028 price-to-book value (P/BV). The target implies an 8% upside from the current market price of Rs 361.

The brokerage said a meaningful re-rating would require sustained improvement in return on assets (RoA) and return on equity (RoE), supported by continued expansion in higher-yielding retail lending segments.

While it expects the company to deliver healthy AUM growth and gradual improvement in profitability over the medium term, it also believes current valuations adequately reflect these positives. The AUM is expected to grow at a CAGR of 23% over FY26-28E.

Also Read | Zerodha now wants to enter investment banking space, seeks Sebi nod

The company’s margins are expected to gradually improve as the portfolio mix shifts further toward retail and unsecured lending, with NIMs increasing to nearly 5.4%/5.5% in FY27E/FY28E.

While credit costs increased following the TMFL merger due to stress in the Motors Finance and select unsecured portfolios, asset quality trends have improved meaningfully, with Motors Finance returning to profitability in 4QFY26, the credit costs is expected to normalize further and moderate to nearly 1.1% of AUM over FY27E-FY28E.
Tata Capital benefits from a strong liability franchise, supported by Tata Group parentage and a AAA credit rating which enables access to funding at competitive costs. The brokerage expects margins to gradually improve as the portfolio mix shifts further toward retail and unsecured lending, with NIMs increasing to nearly 5.4%/5.5% in FY27E/FY28E from approximately 5.2% in FY26.Its NIM moderated in FY26 due to slower growth in unsecured lending and the continued runoff of the motor finance portfolio. However, improving disbursement trends in unsecured segments and the turnaround of the motor finance business are expected to support margin recovery from FY27

As the company has displayed disciplined cost control measures through digital initiatives, process improvements, and branch-level productivity. As new branches scale and technology matures, productivity gains are expected to enhance efficiency. The cost-to-income of the company is estimated at 35%/33% and opex-to-average assets of 2.1%/2.0% in FY27/FY28.

The company is the third-largest diversified NBFC in India with a total AUM of Rs 2.77 trillion as of Mar’26. It is among the fastest-growing large diversified NBFCs, with total AUM (excluding Tata Motors Finance business) recording a strong CAGR of nearly 29% between FY23 and FY26.

The company has displayed consistent growth while maintaining healthy asset quality, reflected in a GS3 of 2% and NS3 of 0.9%, which is among the best within the large, diversified NBFC peer set as of Mar’26.

Also Read | HAL announces final dividend of Rs 10 for FY26. Check record date and other details

Motilal Oswal said that while Tata Capital’s outlook remains favourable, it believes the current valuation adequately reflects the company’s medium-term growth and earnings potential.

Motilal Oswal expects healthy growth momentum across the retail, SME, auto, and housing segments, with housing likely to remain the key growth driver, followed by retail, SME, and the emerging/mid-corporate businesses.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

The fixed-income market has become increasingly focused on the U.S.-Iran conflict, which remains fluid and could escalate further. –Income Research + Management

---

Market in Review

During the first quarter of 2026, investors faced a broadening set of risks, including escalating geopolitical tensions, concerns about private credit, and Artificial Intelligence related disruption fears. None were enough to derail an expanding U.S. economy, even as signs of fragility intensified. The labor market showed that finding a job was becoming more difficult; there were fewer job openings than unemployed workers (a ratio of 0.91); and the average duration of unemployment rose to nearly 26 weeks. Meanwhile, inflation appeared reasonably well anchored with February’s year-over-year Consumer Price Index rising by 2.4%. Given that relatively stable data, the U.S. Federal Reserve (“Fed”) kept its target range steady at 3.50%–3.75% during its January and March meetings. While the Federal Open Market Committee’s March projections still implied one rate cut in 2026, the market lost confidence that the Fed could ease as the U.S.-Iran conflict intensified. With the Strait of Hormuz closed and mounting concerns over increased strikes on energy infrastructure, the West Texas Intermediate crude oil price rose from $57.42 to $101.38 per barrel, with many believing oil—and inflation—could move even higher if the conflict persisted. Against that backdrop, the Treasury curve bear-flattened quarter-over-quarter, reflecting expectations of higher-for-longer monetary policy and slower long-term growth. The two-year Treasury rate rose by 0.32% to 3.79%, while the 30-year rate rose by 0.07% to 4.91%.

Portfolio Performance

During the first quarter of 2025, the Harbor Disciplined Bond ETF (“ETF”) returned –0.05% (NAV), matching its benchmark, the Bloomberg US Aggregate Bond Index, which also returned –0.05%.

The ETF’s performance relative to the Index was driven primarily by security selection in the Financials sector.

The investment-grade and high-yield corporate markets were

By Gary Zhu, CFA and Deanna Leighton, CFA

A holistic approach may help navigate the diverse, dynamic world of fixed-income opportunities.

Insurance investors face a broader opportunity set than ever across public and private credit—from

Chinese humanoid robots attempted penalty kicks in a World Cup-style event. The experiment showcased their ability to perform precise and coordinated movements in sports simulations. The event highlights advancements in robotics technology, demonstrating potential applications in entertainment and sports training. For more details, visit Bloomberg Television and related sources.

---

In an innovative display of technology, Chinese robots recently participated in a World Cup-style penalty kick challenge, showcasing advancements in robotics and artificial intelligence. The event aimed to demonstrate the precision and agility of autonomous machines in dynamic tasks traditionally performed by humans in sports. These robots, equipped with sophisticated sensors and motion algorithms, attempt to simulate real football penalties, challenging human players in accuracy and speed.

The experiment attracted significant attention from both tech enthusiasts and sports fans, highlighting China’s progress in robotics research. Engineers programmed the robots to analyze various factors such as ball trajectory, goalkeeper positions, and environmental conditions. Their goal was to improve robotic motor skills and decision-making, pushing the boundaries of what machines can achieve in complex physical activities.

This groundbreaking event symbolizes China’s efforts to integrate robotics into everyday life. Beyond entertainment, such advancements could be applied to rehabilitation, automation, and even future sports training. As robots continue to improve, they may someday participate in more elaborate sports competitions, blending technology with traditional human activities in exciting new ways.

source

Other People are Reading

Meta Platforms shares climbed Monday morning, extending a recovery from a rough stretch earlier this year in which investors grew increasingly anxious about the social media giant’s enormous spending plans for artificial intelligence infrastructure.

Shares of the Menlo Park, California-based company were trading at $563.22 as of 11:09 a.m. EDT, up $12.97, or 2.36%, on the day. The gain builds on a broader rebound that has taken hold over the past few sessions, with the stock recovering meaningfully from levels well below its all-time closing high of $787.42, reached in August 2025, and its 52-week intraday high of roughly $796.

Much of Meta’s stock weakness earlier this year traced back to investor unease over the scale of the company’s planned capital expenditures. Meta has guided toward 2026 capital spending of between $125 billion and $145 billion, an enormous sum directed primarily at AI hardware and data center construction. That spending forecast compressed projections for the company’s free cash flow and contributed to a year-to-date de-rating of the stock, as some investors questioned whether returns from those AI investments would materialize on a timeline that justified the near-term financial strain.

Monday’s rally reflects what analysts have described as a growing belief that the earlier selloff went too far. Institutional investors and analysts increasingly point to Meta’s distinct advantage among megacap technology peers: a deeply established advertising business capable of converting AI investment into tangible near-term returns through improved targeting, stronger user engagement and rising ad pricing power. That contrasts with some AI infrastructure spending elsewhere in the sector, where monetization paths remain less clearly defined or more dependent on a small number of large customers.

A specific catalyst behind Monday’s move involves an internal policy shift at Meta. The company has enacted new restrictions limiting its applied AI developers from using external coding and AI development platforms, including tools such as Claude Code and Codex from outside providers. The move is intended to guard against unintentional model distillation, a process by which a company’s proprietary AI systems could inadvertently leak insights to external platforms, and to protect Meta’s broader intellectual property as it continues developing its own AI models in-house. While the restriction introduces some near-term friction for Meta’s internal software development workflows, market commentary has framed the decision as a sign of the company’s determination to reduce reliance on external AI tools and protect the long-term value of its own AI research.

Not all of the news circulating around Meta on Monday was as clearly favorable. Reports emerged over the weekend that Google had placed limits on Meta’s access to its Gemini AI models, citing infrastructure and compute capacity constraints on Google’s end. Meta had reportedly relied heavily on Gemini to help automate content-safety and anti-scam processes across its platforms, and the new restrictions have reportedly delayed several internal projects while forcing the company to impose stricter token-usage limits on its own developers working with the technology. Separately, internal disclosures reported Monday indicated that Meta’s fast-tracked effort to replace human content moderators with generative AI systems has run into what were described as systemic glitches in the automated moderation rollout, raising questions about the pace at which the company is shifting that function away from human reviewers in pursuit of cost savings.

Despite those operational headwinds, the stock’s gains suggest investors are currently weighing Meta’s long-term advertising and AI monetization story more heavily than the specific near-term technical and operational frictions tied to its AI rollout. Wall Street’s broader view of the stock has remained largely favorable over the past month, with multiple analysts maintaining Buy ratings. Price targets among analysts tracked by financial data providers have averaged in the range of $825 to $827, with high estimates reaching as much as $1,015 and low estimates around $664, reflecting a wide but generally optimistic range of expectations for where the stock could trade over the coming year.

Meta’s underlying financial profile remains substantial even amid the AI spending debate. The company’s trailing 12-month revenue stands at roughly $201 billion, with net profit of approximately $60.5 billion over the same period, figures that place Meta among the top performers in its broader software and internet services industry category. The company operates through two primary segments: Family of Apps, which includes Facebook, Instagram, WhatsApp and Messenger, and Reality Labs, which covers the company’s virtual reality, augmented reality and AI wearable device efforts, including its AI-enabled smart glasses line. Meta’s next quarterly earnings report is expected around July 29, a date that will give investors a clearer read on whether the company’s AI spending is beginning to show measurable returns within its advertising business or its broader product lineup.

The company also continues to pay a modest dividend, with a forward annualized payout of $2.10 per share, translating to a yield of roughly 0.38% at current price levels; the most recent ex-dividend date passed on June 15.

Meta’s situation illustrates a broader theme playing out across megacap technology stocks this year, as investors attempt to differentiate between companies whose AI spending appears likely to generate near-term, identifiable returns and those whose investment cases rest more heavily on longer-term, less certain payoffs. For Meta, the combination of an established and highly profitable advertising engine, continued growth in user engagement metrics, and a defensive posture toward protecting its own AI development from leakage to external platforms appears, for now, to be winning over investors who had grown skeptical of the company’s spending trajectory earlier this year.

Whether that renewed optimism proves durable will likely depend on Meta’s ability to demonstrate concrete progress on AI monetization in its upcoming earnings report, along with how the company navigates near-term friction points, including its complicated relationship with external AI providers like Google and the operational challenges tied to automating content moderation at scale. For Monday at least, investors appeared willing to look past those complications and reward the stock for what many now view as a buying opportunity following an earlier overreaction to the company’s aggressive AI infrastructure spending plans.

Security and facility management services provider SIS Limited has announced a share buyback of up to Rs 120 crore, which will be the company’s fifth buyback programme since its stock market debut in 2017.

The board of the company has “approved, in principle”, a proposal to undertake a share buyback of up to Rs 120 crore, SIS said in a regulatory filing.

This will be “at a maximum price of Rs 478.50 per equity share, representing a 10 per cent premium to the closing price on June 25, 2026,” it added.

The company estimates that around 25 lakh shares could be bought back under the proposed programme, although the final number may vary depending on the buyback price and other factors.

The company said the proposed buyback, which is subject to regulatory and shareholder approvals, will take the total capital returned by the company to shareholders through dividends and buybacks to around Rs 720 crore since its listing in August 2017.

“SIS has returned capital to shareholders in every phase after going public – first through dividends, then through buybacks,” it said, adding that the company has so far returned about Rs 600 crore to shareholders through four completed buybacks worth around Rs 420 crore and dividends of about Rs 180 crore.
The proposed buyback would add a further Rs 120 crore to the payout, it added. “Across four completed buybacks (Rs 420 crore) and its dividends (Rs 180 crore), the company has returned an estimated Rs 600 crore to its shareholders; this proposed fifth programme commits up to a further Rs 120 crore, taking the cumulative total to approximately Rs 720 crore,” the company said in a statement.

SIS had undertaken buybacks of Rs 100 crore in FY21, Rs 80 crore in FY23, Rs 90 crore in FY24 and Rs 150 crore in FY26.

During FY26, the company also paid dividends amounting to Rs 98.86 crore, taking total shareholder returns for the fiscal to about Rs 249 crore.

Commenting on the proposal, Group Managing Director Rituraj Kishore Sinha said the company has bought back nearly 86 lakh shares since listing and will continue to evaluate opportunities to return surplus capital to shareholders.

“The proposed fifth buyback, like the four before it, is expected to be accretive to both earnings per share and return on capital,” he said.

The mode of buyback and detailed terms will be finalised after obtaining necessary approvals under applicable provisions of the Companies Act and the Securities and Exchange Board of India (SEBI) regulations.

NEW YORK — Shares of International Business Machines Corp rose modestly Monday, reflecting steady investor interest in the technology services leader’s strategic shift toward artificial intelligence, hybrid cloud solutions and enterprise software amid a competitive digital transformation market.

The stock advanced about 1.7% to around $276.28 in morning trading, adding to recent performance as IBM continues executing on its multiyear transformation plan under CEO Arvind Krishna.

IBM has repositioned itself as a hybrid cloud and artificial intelligence company, leveraging its deep enterprise relationships and expertise in mission-critical systems. The company’s Watson artificial intelligence platform and Red Hat open-source software have become central to its growth strategy.

Recent quarterly results showed resilience in key segments despite macroeconomic pressures on information technology spending. IBM reported solid demand for its consulting services and software offerings, with artificial intelligence-related bookings gaining traction.

The company’s focus on industry-specific solutions has resonated with large enterprises seeking to integrate artificial intelligence into existing workflows. IBM’s approach emphasizes responsible artificial intelligence deployment with attention to governance, security and explainability.

Hybrid cloud infrastructure remains a cornerstone of IBM’s business, enabling clients to manage workloads across private and public environments. Partnerships with major cloud providers complement IBM’s own infrastructure offerings.

IBM’s acquisition of Red Hat has strengthened its position in open-source technologies, particularly Kubernetes container orchestration and Linux-based solutions. This has expanded its addressable market in modern application development.

Artificial intelligence integration across IBM’s portfolio includes tools for data management, automation and decision intelligence. The company has highlighted use cases in financial services, healthcare, supply chain and customer service.

Monday’s share movement lacked a singular catalyst, suggesting continuation of positive sentiment from recent operational updates and broader technology sector stability. IBM shares have shown relative resilience compared to more volatile growth names.

Analysts maintain generally constructive views on IBM, citing its recurring revenue base, strong free cash flow generation and strategic investments in high-growth areas. Some have noted potential for margin expansion as artificial intelligence and cloud contributions increase.

IBM’s consulting business provides implementation expertise for digital transformations, helping clients navigate complex technology landscapes. This services revenue stream offers stability while creating opportunities for software and infrastructure sales.

The company’s research division continues producing breakthroughs in quantum computing, semiconductors and artificial intelligence algorithms. These innovations support both internal development and potential commercialization.

Global operations expose IBM to various economic conditions and regulatory environments. The company has emphasized geographic diversification and adaptation to local market needs.

Cybersecurity remains a priority as enterprises face increasing threats. IBM’s security solutions integrate artificial intelligence for threat detection and response, addressing a critical enterprise pain point.

Sustainability initiatives include commitments to renewable energy for data centers and helping clients reduce their environmental footprint through technology. These efforts align with growing corporate environmental, social and governance expectations.

IBM’s dividend remains attractive to income-focused investors, with a history of consistent payouts reflecting financial discipline. The company balances shareholder returns with investments in future growth.

As artificial intelligence adoption accelerates, IBM positions itself as a trusted partner for enterprises wary of experimental approaches. Its emphasis on governance and integration with existing systems differentiates it from pure-play artificial intelligence vendors.

The hybrid cloud market continues expanding as organizations balance control, cost and scalability. IBM’s offerings aim to simplify multicloud management while ensuring security and compliance.

Monday’s trading occurred amid broader market movements in technology and industrial stocks. IBM’s performance reflects its mature business model compared to high-growth peers.

The company has streamlined operations through previous restructuring efforts, focusing resources on core strengths in artificial intelligence, cloud and consulting. This focus has improved efficiency metrics.

Industry analysts expect continued artificial intelligence investment across enterprises, creating opportunities for IBM’s software and services. Success depends on converting interest into large-scale deployments.

IBM’s Watsonx platform provides tools for building, deploying and governing artificial intelligence models. The company highlights its capabilities in data preparation, model training and risk management.

Partnerships with technology providers and industry leaders extend IBM’s reach. Collaborations help integrate its solutions into broader ecosystems that clients already utilize.

As IBM advances its strategy, investor attention centers on artificial intelligence revenue growth, cloud bookings and consulting margins. Consistent progress on these metrics supports valuation.

The technology services sector faces talent competition and pricing pressures, yet IBM’s scale and brand provide advantages in winning large contracts. Its focus on mission-critical systems enhances stickiness.

Monday’s gains contribute to IBM’s steady performance profile. The stock reflects a balance between growth opportunities in emerging technologies and stability from established businesses.

IBM’s century-plus history of adaptation in the technology industry underscores its resilience. Continued innovation while maintaining operational discipline positions it for sustained relevance.

The company’s role in enterprise digital transformation remains vital as organizations modernize legacy systems and adopt artificial intelligence. IBM’s expertise in both areas creates cross-selling opportunities.

As markets evaluate technology investments, IBM’s combination of growth initiatives and shareholder returns appeals to a broad investor base. Its trajectory will depend on successful execution in a dynamic competitive environment.