Business

Non Banking Finance Corporations’ (NBFC) Assets Under Management (AUM) growth is likely to moderate to 18.5% in FY26, after bank funding to the sector reduced even as the Reserve Bank of India normalised risk weights, according to India Ratings, a credit rating agency. The AUMs increased at a pace of 25% in FY25.

“Ind-Ra has maintained a neutral sector outlook for NBFCs and Stable rating outlook for FY26. The ability of lenders to secure funding for growth will depend on how asset quality progresses in 2HFY26, especially for lenders operating in the unsecured segment,” said Karan Gupta, Head and Director Financial Institutions at Ind-Ra.

NBFCs are also more cautious in lending as they are concerned about asset quality, especially in the microfinance and unsecured business loans. The credit rating agency expects higher-rated NBFCs — those with higher asset quality — to rely on capital market funding and operate in areas with limited competition from banks. This will lead to an increase in margins for them. The asset-quality concerns are, however, not expected to hit profitability as they have already taken the corrective actions. 

The 100-basis-point cut in repo rate has reduced the 10-year government bond yield by 50 basis points to 6.3% in the middle of 2025. This could mean lower borrowing costs for higher-rated NBFCs. 

Unsecured business loans and microfinance segments will face continued asset quality stress, the credit rating agency said,  The repayment behaviour of property backed loan may also be volatility.

Geopolitics, geoeconomics and geotechnology are all changing the world order and hugely impacting businesses and economies globally, said Ashwini Vaishnaw, Union Minister for Railway, Information and Broadcasting and Minister of Electronics and Information Technology, in Bengaluru on Tuesday (August 5, 2025).

During this transformative period, India was fortunate to have a steady growth, he said while delivering a keynote address virtually to SAP Labs’ leadership and employees at the Garman tech major’s newly set up SAP Labs India Innovation Park at Devanahalli in the City outskirts.

Commenting on India’s economic growth and technological advancements in Railways even under challenging times, the Union Minister said, “From being the 11th largest economy in the world 11 years ago, India is now on track to become the third largest economy soon. Electronics exports have grown 8 times in the last 11 years. Very soon, we will start the production of the first Made in India chip. The Bullet train accelerates from 0-100 kmph in 54 seconds whereas Vande Bharat does it in 52 seconds.’‘

He further said, as part of the union government’s initiatives to democratise compute power, 34,000 GPUs were made available to every student, researcher, and college startups across the country, a provision made through a Public-Private Partnership. Cost of per computing was less than a $ in India when that was $2.5 globally. “This is the kind of empowerment we are doing for young innovators. We in India decided to democratise access to compute power and in a very interesting public private partnership.”

SAP Labs invested €194 million to set up SAP Labs India Innovation Park, on a patch of 41 acres of land, and the facility is expected to create 15,000 jobs for AI innovators.

“SAP’s this new facility in Bengaluru is a timely investment in India’s growth story. This campus reflects global confidence in India’s talent and innovation ecosystem. It will further boost India’s position as a trusted technology partner,” Mr. Vaishnaw said.

SAP’s new innovation campus would reflect global confidence in India’s talent and innovation ecosystem, said the minister.

Strategically located near Kempegowda International Airport, SAP Labs campus is envisioned as a flagship innovation and R&D hub for India and the broader Asia-Pacific region. Once fully operational, it will house 15,000 professionals, making it SAP’s largest office in India, and will anchor Global AI roles in Product Engineering and Customer Services & Delivery, according to company officials.

The facility would lead the development of Joule’s agentic AI capabilities, reinforcing India’s growing role in AI innovation. As a future-ready facility, the campus would also feature a Customer Experience Centre, hybrid collaboration zones, AI labs, startup incubation hubs, hackathon spaces and plenty of green zones.

After a gap of 14 years, Tamil Nadu has recorded a double-digit economic growth rate in real terms during 2024-25 with 11.19%, according to the revised estimates of the Union Ministry of Statistics and Programme Implementation for various States.

In 2010-11, the State registered 13.12%. Coincidentally, on both occasions, the DMK was in power. The latest revised estimates were prepared as on August 1, 2025. Fifteen years ago, the base year was 2004-05, whereas it is 2011-12 now. Former Director of the Madras School of Economics, K.R. Shanmugam, attributes the growth to the strong performance by the tertiary and secondary sectors.

About five months ago, when the State-wise advance estimates were made public, Tamil Nadu’s real economic growth was 9.69%. The latest figure marks an increase of about 1.5 percentage points. Apart from having finished the topper, Tamil Nadu has accomplished what no other State has done — recording the double-digit growth. It may be noted that the data for six States — Goa, Gujarat, and four northeastern States — have not been made public yet, apart from those for two Union Territories.

In fact, the figures exceeded the forecast made in the Tamil Nadu Budget presented early this year. The State government was modest in projecting Tamil Nadu’s nominal Gross State Domestic Product (GSDP) to grow at 14.5% in 2024-25, with real growth put at 9% and an average inflation of 5%. But the real growth is higher by nearly 2.2%. At constant prices (base year: 2011-12), Tamil Nadu’s GSDP is estimated at ₹17,32,189 crore for 2024-25, up from ₹15,57,821 crore in 2023-24.

The revised figures also indicated stronger performance for 2023-24, with the real GSDP growth revised upward from 8.23% to 9.26%. However, the growth estimated for 2022-23 had been reduced from 8.13% to 6.17%.

Going by the data on per capita Net State Domestic Product (NSDP) at current prices, Tamil Nadu ranked third among major States in 2024-25, with an estimated per capita income of ₹3,61,619, following Telangana (₹3,87,623) and Karnataka (₹3,80,906). 

Commenting on Tamil Nadu’s economic trajectory, Dr. Shanmugam, who is serving the Finance Department as Economic Consultant, hopes that if the State continues to maintain its growth, aided by strong export performance, it is on track to achieve its target of a trillion-dollar economy by 2031-32. The higher growth rate is likely to lead to significant improvement in fiscal indicators, such as lower fiscal and revenue deficit and debt-to-GSDP ratio. If all the major sectors grow by half-a-percent more than what they did in 2024-25, the State economic growth may be around 12% during the current year (2025-26), he points out.

According to the Union Ministry’s data, the growth rate figures of select States for 2024-25 were Uttar Pradesh-8.99%; Andhra Pradesh-8.21%; Telangana-8.08%; Karnataka-7.37%; and Maharashtra-7.27%.

Adani Ports and Special Economic Zone Ltd (APSEZ) on Tuesday (August 5, 2025) posted a 6.54% rise in its consolidated net profit to ₹3,310.60 crore for the June quarter of the current financial year on account of higher income.

It had reported a net profit of ₹3,107.23 crore in the April-June period of FY25, the company said in a regulatory filing.

Total income surged to ₹9,422.18 crore in the quarter under review from ₹8,054.18 crore in the year-ago quarter.

Expenses also rose to ₹5,731.88 crore in the period from ₹4,238.94 crore a year ago.

APSEZ Whole-time Director & CEO Ashwani Gupta said, “This quarter’s 21% revenue growth is anchored by extraordinary momentum in our logistics and marine businesses, which grew 2x and 2.9x respectively.”

“With expanding trucking and international freight network services and a fast-growing, diversified marine fleet in the MEASA (Middle East Africa South Asia) region, we are deepening our integrated transport utility approach and extending our value chain from port gate to customer gate,” Mr. Gupta added.

In a statement, the company said it handled 121 MMT (Million Metric Tonne) cargo volume in Q1 FY26, registering a growth of 11%, driven by containers.

“All-India cargo market share increased to 27.8% (27.2% in Q1 FY25). Container market share stood at 45.2% (45.9% in Q1 FY25),” APSEZ said.

According to the company statement, Haifa port operated unhindered throughout and reported 25% YoY growth in container volume and 38% YoY growth in other cargo volume during the quarter, leading to overall volume growth of 29% YoY.

“This led to the highest quarterly revenue and operating EBITDA for Haifa port since acquisition by APSEZ,” it said.

Krishnapatnam port handled its highest-ever cargo volume (5.85 MMT) in June 2025.

According to the statement, while APSEZ’s domestic ports revenue increased by 14% YoY to ₹6,137 crore, its international ports revenue increased 22% YoY to ₹973 crore.

APSEZ said the company launched a tender offer to buy back up to $450 million of its outstanding USD Bonds.

“As of 29 July 2025, received $384 million of tenders (tender offer will expire on 13 August 2025),” it said.

While in the first quarter of FY26, the cash balance of APSEZ stood at ₹16,921 crore, its gross debt was ₹53,089 crore.

APSEZ also commenced operations at a fully automated container terminal in Colombo port and an Export terminal in Dhamra Port.

The company said its Vizhinjam port completed its first year and achieved 100% utilisation in its ninth month of operation. The Vizhinjam port also commenced construction of Phase 2 at the port.

The company’s marine business recorded a 2.9-fold year-on-year (YoY) growth, rising to ₹541 crore from ₹188 crore, with a fleet of 118 vessels.

Benchmark stock indices Sensex and Nifty closed lower on Tuesday (August 5, 2025) following selling in oil, gas and banking shares ahead of the Reserve Bank’s monetary policy announcement on August 6.

The 30-share BSE Sensex fell by 308.47 points or 0.38% to close at 80,710.25. During the day, it declined 464.32 points or 0.57% to hit an intraday low of 80,554.40.

The broader NSE Nifty fell 73.20 points or 0.30% to close at 24,649.55. In the intraday session, it slipped by 132.45 points or 0.53% to 24,590.30.

Among Sensex shares, Adani Ports, Reliance Industries, Infosys, ICICI Bank, Eternal, BEL, HDFC Bank, Power Grid, ITC and Sun Pharmaceutical were the major laggards.

However, Titan, Maruti, Trent, Bharti Airtel, Bajaj Finance, Tech Mahindra, State Bank of India, L&T, HCL Technologies and NTPC were among the gainers.

The BSE smallcap gauge went lower by 0.27% and the midcap index by 0.14%.

In Asian markets, South Korea’s Kospi, Shanghai’s SSE Composite index, Hong Kong’s Hang Seng and Japan’s Nikkei 225 index closed in the positive territory.

The European markets were trading in green. The U.S. markets ended higher on Monday.

Global oil benchmark Brent crude declined 1.02% to $68.06 a barrel.

Foreign Institutional Investors offloaded equities worth ₹2,566.51 crore while Domestic Institutional Investors purchased equities worth ₹4,386.29 crore on Monday, according to exchange data.

On Monday, the 30-share Sensex gained 418.81 points to settle at 81,018.72, and the NSE Nifty jumped by 157.40 points to close at 24,722.75.

The rupee depreciated 16 paise to close at 87.82 (provisional) against the U.S. dollar on Tuesday (August 5, 2025), as risk-off sentiment deepened after U.S. President Donald Trump renewed his threat to raise tariffs on Indian goods over New Delhi’s continued purchases of Russian oil.

Forex traders said the rupee is likely to slide further as India-U.S. trade deal uncertainty continues to dent domestic market sentiments.

Moreover, weak equity markets dented investors’ sentiments further. However, the domestic unit pared initial losses on supposed intervention by the Reserve Bank of India (RBI).

A soft U.S. dollar and overnight decline in crude oil prices also cushioned the downside to some extent, they said.

At the interbank foreign exchange, the domestic unit opened at 87.95 against the greenback, and during the day, it touched an intra-day high of 87.75 against the American currency.

At the end of Tuesday’s (August 5, 2025) trading session, the domestic unit was at 87.82 (provisional), down 16 paise over its previous close.

On Monday (August 3, 2025), the rupee depreciated 48 paise to close at 87.66 against the U.S. dollar.

In a fresh trade threat against India, President Donald Trump on Monday (August 3, 2025) said he will “substantially” raise U.S. tariffs on New Delhi, accusing it of buying massive amounts of Russian oil and selling it for big profits.

Last week, the Trump administration slapped a 25% duty on all Indian goods. The U.S. president also announced a penalty for buying “vast majority” of Russian military equipment and crude oil.

“We expect the rupee to continue to slide as India-U.S. trade deal uncertainty continues to dent domestic market sentiments. Weak tone in the domestic equities and FII outflows may further pressurise the rupee,” Anuj Choudhary, Research Analyst, Commodities Research, Mirae Asset Sharekhan, said.

Mr. Choudhary added that “the rupee may also remain weak ahead of the RBI’s monetary policy. Market expects a rate cut by the central bank. However, overall weakness in the U.S. dollar amid rising odds of a rate cut by the Fed in September may support the rupee at lower levels”.

Meanwhile, investors remain cautious ahead of the RBI monetary policy decision this week.

RBI Governor Sanjay Malhotra-headed rate-setting panel on Monday (August 3, 2025) started the three-day deliberations to decide the next bi-monthly monetary policy.

The six-member Monetary Policy Committee (MPC) is scheduled to announce the next bi-monthly policy rate on Wednesday (August 6, 2025).

Meanwhile, Brent crude prices fell 0.97% to $68.09 per barrel in futures trade, after OPEC+ agreed to hike another large output increase in September, adding to oversupply concerns after U.S. data showed lacklustre fuel demand.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.18% to 98.68.

In the domestic equity market, the 30-share BSE Sensex advanced 308.47 points, or 0.38%, to close at 80,710.25, while the Nifty rose 73.20 points, or 0.30%, to settle at 24,649.55.

Foreign institutional investors (FIIs) offloaded equities worth $2,566.51 crore on a net basis on Monday (August 3, 2025), according to exchange data.

Deloitte India on Tuesday (August 5, 2025) projected India’s economic growth at 6.4-6.7 % in the current fiscal citing robust domestic fundamentals and expanding global opportunities.

It, however, said that India must monitor its trade exposure and be prepared for the outcomes of geopolitical uncertainties

Strategic trade negotiations, notably with the U.K. in May and the ongoing talks with the U.S., and the highly anticipated deal with the European Union by the end of the year, will likely act as powerful multipliers of income, jobs, market access, and domestic demand.

India’s economic growth was at 6.5 % in 2024-25.

Deloitte projects 6.4-6.7 % growth for FY 2025–26, driven by resilient domestic demand, easing inflation, and a bold push in domestic policy and global trade diplomacy, it said in a statement.

“India’s economic trajectory stands out in a turbulent global landscape. Our momentum is driven by a virtuous trifecta, resilient capital markets, a dynamic consumer base and a globally competitive workforce,” Deloitte India, Economist, Rumki Majumdar said.

The consultancy firm further said that India is taking strategic steps to expand its global trade presence.

Recent trade deals offer a strategic advantage: it is likely to deepen bilateral cooperation in areas such as AI, digital transformation, and innovation-led startups.

“As FY 2025–26 unfolds, India must monitor its trade exposure and be prepared for the outcomes of geopolitical uncertainties,” Deloitte said.

The recent regional conflict and restrictions on critical minerals and specialised fertilisers are likely to affect the growth outlook.

“India’s growth story will be driven by a combination of robust domestic fundamentals and expanding global opportunities, amid uncertainties,” it added.

Kerala Finance Minister K.N. Balagopal has warned that Kerala needs to prepare well to tackle the ‘tariff war’ looming over the economy, propelled by the recent tariff policies of the United States and other global players.

Mr. Balagopal was speaking after inaugurating a two-day seminar ‘Post-COVID Development Challenges and Response: Kerala through the lens of State budgets’ organized by the Gulati Institute of Finance and Taxation (GIFT) in Thiruvananthapuram on Tuesday (August 5, 2025).

“It has to be examined how these policies impact the Indian economy and specifically Kerala, whose exports cover multiple sectors,” he said.

The Finance Minister suggested that the academic community organise a roundtable discussion on the implications of these policies for India and Kerala to generate clarity on what lies ahead for the economy.

‘Dangerous situation’ ahead

Mr. Balagopal said he perceived a “dangerous situation” ahead, referring to recent demands that ‘India should reduce its tariffs.’

“The tariff war looming over us will worsen our economy further,” he said, adding that the influx of imports at low tariffs would create an economic situation “much worse than the COVID-19 pandemic.”

M.A. Oommen, eminent economist and Distinguished Professor at GIFT who chaired the session, underscored the need for Kerala to focus on the protection and conservation of its rich biodiversity, tackle the spectre of corruption and nurture the public sector enterprises. Mr. Oommen lauded Mr. Balagopal for an “excellent linear programming exercise” in steering Kerala’s economy through a period of fiscal stress.

Pointing out that major challenges lay ahead for the economy in the years ahead, he urged Left democratic forces to rise up to the occasion.

C. Balagopal, chairman, Kerala State Industrial Development Corporation (KSIDC), said current policies and public finance constraints should be understood within the framework of whether government policies are promoting the growth of value addition in sectors, and what needs to be done to generate more value addition in them. “How the sectoral distribution of the gross state domestic product (GSDP)  and the State meeting total factor productivity (TFP) are pertinent questions,” he said.

Additional Chief Secretary (Finance) K.R. Jyothilal, GIFT director K.J. Joseph and GIFT registrar Saraf A. also spoke.

Senior economists and planning experts are attending the seminar which focusses on development issues that Kerala has been facing since the pandemic.

The initial public offer of Highway Infrastructure Ltd got fully subscribed within hours of opening for bidding on Tuesday (August 5, 2025).

The three-day initial share sale received bids for 11,97,90,186 shares against 1,60,43,046 shares on offer, translating into 7.47 times subscription, according to data available with the NSE till 11:45 hours.

Retail Individual Investors (RIIs) part fetched 9.63 times subscription while the quota for non-institutional investors got subscribed 7.14 times. The Qualified Institutional Buyers (QIBs) portion received 90% subscription.

Highway Infrastructure Ltd. on Monday (August 4, 2025) said it had raised ₹23.40 crore from the anchor investors, including HDFC Bank and Abans Finance Pvt. Ltd.

The ₹130-crore Initial Public Offering (IPO) will conclude on Thursday (August 7, 2025).

The price band has been fixed at ₹65-70 per share.

The IPO is a mix of fresh issue of 1.39 crore shares aggregating to ₹97.52 crore and an offer for sale of 46.4 lakh shares amounting to ₹32.48 crore.

Proceeds from the fresh issue to the tune of ₹65 crore will be utilised to fund the working capital requirements of the company and the balance for general corporate purposes.

Incorporated in 1995, Highway Infrastructure Ltd (HIL), is engaged in tollway collection, EPC (Engineering, Procurement, and Construction) projects, and real estate development.

The Indore-based company specialises in the construction and maintenance of roads, highways, bridges, and residential projects.

The company’s total income stood at Rs 504.48 crore and profit after tax of Rs 22.40 crore.

The company’s shares will be listed on the BSE and NSE.

Pantomath Capital Advisors is the sole book-running lead manager, while Bigshare Services is the registrar for the IPO.