ET Intelligence Group: The Reliance Mukesh Ambani group (RIL) will likely command nearly 7% of the total market capitalisation of companies listed on the BSE after the initial public offering (IPO) of its telecom and digital media arm, Jio Platforms (JioP) compared with the current share of under 4%. This reflects a significant value unlocking for investors. In addition, at the higher end of the anticipated valuation band for JioP, the RIL group will host India’s two largest companies by market cap – Reliance Industries with market cap of ₹17.7 trillion and JioP with an estimated market cap of ₹14 trillion. HDFC Bank, Bharti Airtel, and ICICI Bank with respective market caps of ₹12 trillion, ₹11.6 trillion and ₹9.7 trillion will be next on the ranking tally.

The combined market cap of the two companies of the RIL group is expected to be around ₹32 trillion. It will nearly match the current combined market value of ₹33 trillion for HDFC Bank, Bharti Airtel, and ICICI Bank.

At present, the market cap of the companies listed on the BSE is nearly ₹478 trillion. For the Nifty 50 set of companies, the market cap is ₹194 trillion, which implies that the RIL group’s market cap will be over 16% of the benchmark index’s market value.

Globally, Elon Musk promoted Tesla and SpaceX together account for nearly 5% of the total market cap of the US companies. After a strong debut on Nasdaq on June 12, SpaceX commands a market cap of $2.4 trillion, while Tesla’s is $1.3 trillion. The market cap of listed companies in the US is over $77 trillion, according to the data from Bloomberg.
Internationally, technology led companies have been driving overall market valuations to record levels. For instance, Samsung Electronics and SK Hynix, the top South Korean companies based on market value, account for nearly 50% of the country’s market cap. In the case of Taiwan, chip maker TSMC contributes over 40% to the country’s market cap.

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.