Articles by Avishek Banerjee

Technology

Markets Rally on Strong GDP Growth and GST Simplification; Small-Cap Funds Shine: ICRA Analytics

India’s domestic equity markets gained traction in recent weeks, buoyed by a strong set of macroeconomic indicators and policy reforms, according to a latest report by ICRA Analytics. The country’s GDP grew by 7.8% year-on-year in Q1 FY26, marking the fastest expansion in five quarters, while the Services PMI surged to 62.9 in August 2025—its highest level in over 15 years—signalling robust business activity and sustained demand.Adding to the positive sentiment, the GST Council’s decision to simplify tax slabs—from the existing 5%, 12%, 18%, and 28% structure to a two-rate regime of 5% and 18%, along with a special 40% slab for luxury goods such as premium cars, tobacco, and cigarettes—was widely welcomed by investors and industry alike.Market optimism was also underpinned by the U.S. Federal Reserve’s first rate cut of 2025, a 25 basis points reduction in September, aimed at countering softness in the American labor market. However, gains were tempered by ongoing uncertainties surrounding India–U.S. trade talks and continued foreign institutional investor (FII) outflows from domestic equities.Also Read: Equity Mutual Funds See ₹42,673 Crore Inflows in July as SIPs Drive Long-Term Wealth Creation: ICRA | Republic WorldOn the debt front, bond yields declined as the government projected a smaller revenue loss from GST revisions, easing fiscal worries. Officials’ assurances about adhering to the fiscal deficit target also lent support. Still, the Fed’s cautious tone on future rate decisions limited the upside for bond markets.The report highlighted that all equity mutual fund categories posted positive average returns over the three-, five-, and ten-year periods, although one-year returns remained negative across the board.Small-cap funds outperformed, delivering a 27.59% category average return over five years.Large-cap funds, on the other hand, recorded a 4.92% negative return over the one-year period.Within debt funds, credit risk funds emerged as top performers, offering the highest average returns across the six-month to five-year horizons, with a 10.02% annualised return over six months. Meanwhile, low-duration funds led the one-month category with 18.57% returns, while gilt funds with 10-year constant duration topped the ten-year horizon, delivering 7.76% returns. Overall, all debt fund categories generated positive returns across the one-, three-, five-, and ten-year periods, the report noted.

Technology

India’s Auto Deals Zoom to US$ 4.6 Billion in Q3, Powered by Outbound M&A and EV Push

India’s automotive sector shifted into high gear in the third quarter of 2025, clocking 30 deals worth US$ 4.6 billion, according to the latest Grant Thornton Bharat Automotive Dealtracker. This marks the industry’s strongest quarter in over a year, underpinned by a surge in outbound mergers and acquisitions (M&A) and sustained investor confidence in electric mobility.While overall transaction volumes stayed steady compared to the previous quarter, deal values soared on the back of Tata Motors’ USD 3.8 billion acquisition of Italy’s Iveco S.P.A. — one of India’s largest-ever outbound auto deals. Excluding this mega-transaction, total deal value fell 36% sequentially, underscoring the role of large strategic bets in shaping market momentum.Saket Mehra, Partner and Automotive Industry Leader at Grant Thornton Bharat, said the sector is undergoing a “strategic reset,” balancing policy reforms, shifting consumer demand, and global expansion. He noted that “policy tailwinds like GST 2.0 and targeted tariff reforms” are fuelling investor confidence across electric and alternative mobility platforms.M&A activity rose sharply in value terms, with seven transactions worth USD 4.1 billion, up more than 1,200% over Q2, despite a slight dip in volume. Cross-border deals accounted for 71% of total volumes and nearly all deal value, led by outbound expansions in Europe and Asia.Apart from Tata Motors, Samvardhana Motherson International executed three overseas acquisitions, reinforcing India’s growing influence in global supply chains. Tata Technologies’ USD 88.2 million purchase of Germany’s Es-Tec GmbH added to the trend of Indian firms acquiring advanced engineering capabilities abroad.Private equity activity held firm, logging 23 deals worth US$ 531 million—a 15% rise in volume but 17% decline in value due to smaller deal sizes. Investors showed strong preference for scalable tech-led models, with Mobility-as-a-Service (MaaS) dominating flows.The biggest PE deal was Rapido’s US$ 271 million funding from Prosus and WestBridge Capital. IFC’s combined US$ 137 million investment in JBM Ecolife Mobility and GreenCell Mobility will fund 4,000 electric buses across 39 cities, expected to create 12,000 jobs and curb 1.6 billion kg of carbon emissions.Also Read: Festive Auto Boom: 41% of Indians Ready to Buy Vehicles as GST 2.0 Spurs Demand | Republic WorldPublic market activity stayed subdued with no major IPOs or QIPs in the quarter, though anticipation builds around Toyota India’s expected IPO in 2026, which analysts believe could re-energise automotive listings.Venture funding continued to flow into deep-tech and EV infrastructure. TDK Ventures’ USD 21 million investment in Ultraviolette Automotive aims to scale its F77 performance bike globally, while early-stage funding rounds for Indigrid Technology, Evamp, PeakAmp, and Xbattery highlight the growing appetite for clean mobility innovation.