Issue: 1302
·
Nearly 9 in 10 F&O traders lost money in FY26; losses hit
Rs 91,685 crore even as participation fell.
·
After nearly a decade, India allows 10 lakh tonnes of
duty-free raw sugar imports as prices hit record high.
·
BSE cleared as eligible exchange in FTSE Russell equity
indices.
·
LIC gets RBI nod to nearly double stake in HDFC Bank to 9.99%.
·
UP, Japan seek to scale up green hydrogen tie-up.
·
PM Modi calls for better use of govt data, greater
interoperability.
·
Sebi permits IFSCA-regulated entities to access KRA records
for KYC.
·
Sebi to test bond tokenisation, eyes deeper corporate bond
repo market.
Core sector growth eases to
5.4% in July from 6% in June; iron ore, cement lead: India’s core infrastructure sector growth moderated
to 5.4% year-on-year in July 2026, compared with 6% growth recorded in June,
according to provisional data released by the Ministry of Statistics and
Programme Implementation on August 20. The eight-core industries, which account
for 40.27% of the weight of items included in the Index of Industrial
Production (IIP), recorded stronger cumulative growth of 4.3% during April-July
2026, compared with 1.5% in the corresponding period last year. Iron ore
emerged as the fastest-growing segment in July, expanding 29.5% year-on-year.
Cement production rose 13.1%, while electricity generation increased 9%. Coal
output grew 7.6%, followed by steel at 2.9% and refinery products at 2.7%.
(Business Today)
'AI Jobocalypse': Raghuram
Rajan proposes AI token tax to curb job losses, boost govt coffers: Former Reserve Bank of India
(RBI) governor Raghuram Rajan has advocated for a target-based tax on corporate
artificial intelligence usage to level the fiscal playing field between human
labor and automation. Writing in a recent Project Syndicate column titled
"How Corporations Can Mitigate an AI Jobocalypse," the economist
argued that taxing AI "tokens" consumed by businesses could replenish
government treasuries while disincentivising rapid, cost-driven workforce
reductions. According to details reported by The Economic Times, Rajan
highlighted a structural financial distortion in modern employment markets:
companies are mandated to pay social security and employment-related
contributions for human staff, whereas replacing human labor with automated
systems carries no equivalent fiscal obligation.
(Business Today)
Gold reclaims momentum as
US Treasury move sparks bullion rush, gains 2% in a day: Gold prices surged sharply by Rs.3,212
per 10 gram, or nearly 2 per cent, on Thursday, climbing to Rs.1,57,080 from Rs.
1,53,868 in the previous session, buoyed by a strong rally in international
markets. The yellow metal turned bullish after the US Treasury announced that
it would double buyback operations for longer-dated bonds from $2 billion to $4
billion per operation from September 9. The move is expected to provide
liquidity support to the long end of the bond market, pushing the 30-year US
Treasury yield down from near two-decade highs to around 5.19 per cent and
boosting investor interest in gold. In the domestic market, gold
opened higher at Rs.1,57,387 per 10 grams amid strong buying interest,
according to data from the India Bullion and Jewellers Association (IBJA).
Silver also witnessed a sharp rally, rising by Rs.8,541 per kg to Rs.2,37,766
from Rs.2,29,225 in the previous session.
(Business Line)
HDFC Bank raises $1.75
billion in biggest overseas fundraise, highest since 2008 global financial
crisis: HDFC
Bank said on August 20 that it has raised $1.75 billion through senior
unsecured bonds, in its biggest overseas fundraise since the global financial
crisis in 2008, as multiple lenders continue to tap the overseas bond market. The
country’s largest private sector lender said that issuance happened through its
GIFT City branch, and that it was a dual-tranch issuance. The first one was
$500 million of three-year bonds and the second tranche consisted of $1.25
billion of five-year bonds. The three-year notes carry a
coupon of 5.159 percent, while the five-year notes offer 5.401 percent, with
interest payable semi-annually. Both tranches will be settled on August 26. The
three-year bonds will mature by August 26, 2029, while the five-year bonds will
mature by August 26, 2031.
(Moneycontrol)
S Somnath appointed to RBI
central board; Anand Mahindra gets another 4-year term: S Somnath, former chairman of
the Indian Space Research Organisation (ISRO), was on Thursday appointed as a
part-time, non-official director on the central board of the Reserve Bank of
India (RBI). Somnath, who retired from ISRO in January 2025, will serve on the
central board for four years with effect from August 20, 2026, according to an
official statement. Meanwhile, the RBI also
reappointed billionaire Anand Mahindra as a part-time, non-official director on
the central board for another four-year term, according to a separate
statement.
(Moneycontrol)
IRDAI bars Niva Bupa from
opening new offices for six months over expense limit breach: India's insurance regulator
has barred Niva Bupa Health Insurance from opening new places of business for
six months because of the breach of business expense limits, the health insurer
said on Thursday. The insurer failed to comply
with limits on expenses of management, which comprises operating costs and
commissions paid to agents and distributors, during fiscal year 2024-25, as per
the statement. Niva Bupa, backed by UK-based international healthcare group
Bupa, said it complied with the expense rules for fiscal 2025-26 and was on
track to remain compliant in the current fiscal.
(Moneycontrol)
Citi India institutional
asset book crosses Rs.1 trillion after retail exit: Citibank N.A. India has topped Rs.1 trillion
in institutional assets, nearly doubling its Rs.53,000-crore book since it
exited the consumer business in March 2023 by selling it to Axis Bank for a
final consideration of over Rs.11,600 crore, as part of its strategy to sharpen
its focus on institutional and corporate banking across markets, including
India. The bank added about Rs.24,000 crore to its institutional asset book in
the last 12 months, a 30 per cent increase, reflecting robust client activity,
increased capital investment, expanding trade flows and sustained financing
demand across key sectors of the economy, a senior Citibank official told
Business Standard.
(Business Standard)
Citi, HSBC, StanChart adopt
Ant International's AI tool for liquidity risks: Ant International ?launched an upgraded
version of its artificial intelligence model ??on Thursday, signing up major
global banks as financial institutions accelerate the adoption of specialised ?AI
to manage liquidity ?risks. The Singapore-based fintech ?giant rolled out its
Falcon Time-Series Transformer ?Model 2.0 and has partnered with six large
banks including Citi, HSBC, Deutsche Bank , Standard Chartered, and Barclays,
according to ?Kelvin Li, the firm's general ?manager of platform tech.
(Business Standard)
Strong demand at RBI
liquidity mop-up auctions; another Rs.1.5 trn on Friday: The Reserve Bank of India received strong
demand at the variable rate reverse repo (VRRR) auctions on Thursday, with
cumulative bids amounting to Rs 1.91 trillion against the total notified amount
of Rs 1.5 trillion. The central bank conducted two overnight auctions
and plans to conduct another three-day VRRR auction worth Rs 1.5 trillion on
Friday. Market participants said the strong demand was driven by overnight
rates being lower than the weighted average rate offered by the RBI at the VRRR
auction. Banks parked the notified amount at a weighted average rate of 5.24
per cent.
(Business Standard)
India 10-15 years from
battery self-sufficiency; full localisation may lift BESS capex 30%: India could remain 10-15 years away from a globally
competitive, self-sufficient battery cell industry, while pushing domestic
content in grid-scale battery storage projects to 100% could increase project
capital costs by around 30%, highlighting the cost and supply-chain challenge
confronting the country’s rapidly expanding storage market. The gap is already
stark. India has only 2 GWh of commissioned cell manufacturing capacity in
2026, accounting for less than 1% of the approximately 260 GWh battery demand
pipeline from competitive tenders, according to Wood Mackenzie’s Chasing
Self-Sufficiency: Cost of Building an Indigenous Battery Storage Supply Chain
in India report.
(Financial Express)
Aditya Birla Capital enters
gold loan business: Aditya Birla Capital has entered the gold loan
business, making it the third non-banking finance company to foray into the
segment in the past two months. In July, Godrej Capital and Tata Capital
ventured into the territory. The company has plans to roll out 200-300
dedicated gold loan branches by March 2027. “Over the next three years, the
ABCL-NBFC business aims to establish a network of around 1,000 gold loan
branches, building a strong pan-India franchise and further strengthening its
presence across the country,” the company said in a press release on Thursday.
(Financial Express)
DPIIT Signs MoUs with
PhonePe and Shell India to Strengthen Startup Ecosystem and Drive Innovation: The Department for Promotion of Industry and
Internal Trade (DPIIT), Ministry of Commerce and Industry, signed MoUs with
PhonePe and Shell India Pvt. Ltd. on 19 August 2026 to strengthen support for
DPIIT-recognised startups and promote innovation across key sectors of the
economy. Under its collaboration with DPIIT, PhonePe will
provide DPIIT-recognised startups with a range of benefits, including
transaction credits through its Payment Gateway, access to the Indus AppStore,
dedicated onboarding and support services, and opportunities for enhanced brand
visibility. PhonePe will also conduct regular masterclasses and webinars on
topics such as fintech, sales, go-to-market strategies and business scaling,
enabling startups to strengthen their capabilities and accelerate growth. The
MoU with Shell India will focus on supporting startups operating in the energy
and climate-tech sectors. Through this partnership, Shell India will provide
mentorship, strategic guidance, investor and incubator connect, and
opportunities to participate in the Shell E4 Smart Energy Track.
(PiB)
SEBI allows FPIs to use
digitally signed power of attorney for faster onboarding: The Securities and Exchange Board of India
(SEBI) has allowed Foreign Portfolio Investors (FPIs) to submit digitally
signed Powers of Attorney (PoA) to custodians, removing the need for physical
authentication procedures in such documents. The move is aimed at making the
FPI onboarding process faster and improving ease of doing business for foreign
investors. The new provision takes effect from August 20,
2026, and forms part of SEBI’s broader efforts to digitalise the registration
and onboarding process for FPIs.
(Business Today)
SC scraps worker-friendly
1978 ‘industry’ precedent for new labour code: In a verdict in which judges varyingly
differed on issues, a nine-member Bench of the Supreme Court on Thursday held
that a nearly half-century-old expansive interpretation of ‘industry’, which
previously granted workers stronger labour rights and protection, will not
apply under the new Industrial Relations Code, 2020. The verdict had enabled
workers employed in a wide range of employment with a legal recourse, including
collective bargaining, against unfair labour practices by employers. The
48-year-old verdict had exempted only core sovereign activities like judiciary,
law and order, defence, etc, from the purview of ‘industry’, as defined under
Section 2(j) of the Industrial Disputes Act, 1947, in order to protect the
State’s functional autonomy. The 1978 judgment had further introduced a ‘triple
test’ which laid down conditions that any activity which was systematic or
organised, operated on the basis of employer-employee cooperation and dealt in
the production of goods and services to satisfy human wants came within the
ambit of ‘industry’.
(Business Line)
DGFT eases rupee trade rule
for exporters:
The
Directorate General of Foreign Trade (DGFT) has amended the Foreign Trade
Policy 2023 to give Indian exporters greater flexibility in invoicing and
receiving export payments in Indian rupees or foreign currencies. For exports
outside the Asian Clearing Union (ACU), eligible rupee receipts routed through
RBI-approved banking channels—except those relating to Nepal and Bhutan—will
now qualify for FTP incentives and count towards the fulfilment of export
obligations, placing them on par with foreign-currency earnings. Exports
financed through EXIM Bank or Government of India lines of credit may also be
invoiced in rupees. Separate rules continue for ACU members, Nepal, Bhutan and
sensitive trade with Iran. Although the amendment removes regulatory
uncertainty and supports rupee internationalisation, practical challenges
remain, including limited rupee availability abroad, currency convertibility
restrictions, trade imbalances, exchange-rate and hedging costs, complex
banking procedures, and the continued dominance of the US dollar in global
trade.
(Business Line)
OPERATING
LEVERAGE
·
Operating leverage measures how strongly a change in
revenue affects operating profit because of the organisation’s fixed-cost
structure. Businesses with high fixed costs and relatively low variable costs
have high operating leverage.
·
Once the break-even point is crossed, incremental
revenue can generate rapid profit growth. However, revenue decline can also
cause a disproportionate fall in profit.
· Example: A bank invests Rs.500
crore in a digital lending platform. The initial technology and compliance
costs are high, but the cost of processing each additional loan is relatively
low. As loan volumes increase, the average processing cost declines and profitability
improves substantially. If revenue increases by 10% while operating profit
increases by 20%, the business demonstrates high operating leverage.
RBI KEY RATES
Repo
Rate: 5.25%
SDF:
5.00%
MSF
/Bank Rate: 5.50%
CRR:
3.00%
SLR:
18.00%
FOREX RATES (RBI REF. RATE)
INR
/ 1 USD : 95.6416
INR
/ 1 GBP : 130.1685
INR
/ 1 EUR : 111.7253
INR
/100 JPY: 60.3500
EQUITY INDEX
Sensex:
77537.72 (+628.04)
NIFTY:
24231.85 (+153.55)
Bnk NIFTY: 57495.90 (+256.15)
World Senior
Citizen's Day: August 21 is World Senior Citizen's Day, a
special observance dedicated to honoring older adults, recognizing their life
achievements, and raising awareness about issues affecting aging communities.
It also marks the International Day of Remembrance and Tribute to the Victims
of Terrorism.
Historic events: August 21 marks
key milestones, including the passage of India's Wildlife Protection Act in
1972, the passing of legendary shehnai maestro Ustad Bismillah Khan in 2006,
Hawaii becoming the 50th U.S. state in 1959, and the infamous theft of the Mona
Lisa from the Louvre in 1911.
****WISHING A NCE DAY****
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