📰40 Die in Pharma Factory Explosion, India Expands Strategic Oil Reserves, Rupee Slides,

Good afternoon, 

Welcome to the best way to stay up-to-date on India’s financial markets. Here’s what’s in today’s newsletter:

• A devastating explosion at a pharmaceutical factory near Hyderabad has left at least 40 dead,

• India is moving to expand its strategic petroleum reserves,

• and the Indian rupee opened weaker on Tuesday, slipping to 85.59 against the dollar.

Then, we close with Gupshup, a round-up of the most important headlines.

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—Shreyas, [email protected]

Market Update.

A Pharmaceutical Factory Explosion Leaves Death Toll at 40 and Counting.

A devastating explosion at a pharmaceutical factory near Hyderabad has left at least 40 dead and dozens more injured, underscoring persistent safety risks in India’s booming drug manufacturing industry. The blast, which tore through a Sigachi Industries plant in Telangana’s Sangareddy district on Monday, triggered a massive fire that took firefighters hours to bring under control.

Initial investigations point to a pressure buildup in a dryer system, raising concerns over industrial safety standards in one of the world’s largest producers of generic medicines. Industrial accidents remain a recurring challenge in India’s pharmaceutical sector, which supplies more than 20 percent of the world’s generics but often faces scrutiny over outdated plants and lax oversight.

“The death toll from Monday’s incident is the largest from a fire in the state in more than 25 years,” said G.V. Narayana Rao, director of Telangana’s fire services. Emergency crews are now combing through charred debris, with many of the injured being treated for burns and smoke inhalation.

The tragedy comes at a time when India’s pharmaceutical exports continue to expand, playing a vital role in the country’s trade balance and global healthcare supply chains. But incidents like this cast a shadow over the industry’s push to meet higher regulatory standards and win investor confidence. Prime Minister Narendra Modi expressed condolences and pledged compensation, but the broader question remains: Can India balance its pharma ambitions with modernized industrial safety to prevent such deadly lapses?

India Eyes Bigger Strategic Oil Reserves.

India is moving to expand its strategic petroleum reserves in a bid to fortify its energy security amid rising global supply risks. The world’s third-largest oil importer is planning three new storage facilities that would boost its emergency crude stockpile and help meet rising domestic fuel demand.

State-run Engineers India Ltd. is conducting feasibility studies for reserves at Bikaner in Rajasthan, Bina in Madhya Pradesh, and an additional facility in Mangalore, according to Indian Strategic Petroleum Reserve Ltd. CEO L R Jain. Together, these would add as much as 7 million tons of storage capacity, helping India close the gap toward its goal of holding at least 90 days of fuel reserves — a benchmark required for membership in the International Energy Agency.

Currently, India has reserves at Mangalore, Padu, and Vizag that cover about 5.33 million tons of crude, plus additional projects at Padur and Chandikhol already approved. The push for larger stockpiles comes as India’s crude import dependence remains above 80 percent and geopolitical volatility, from Middle East tensions to shipping route disruptions, keeps policymakers focused on supply resilience.

The new reserves will also build on recent policy shifts, allowing private players to lease and trade stored crude, mirroring models used by Japan and South Korea. As domestic fuel demand climbs, expanding strategic reserves will remain a vital macro buffer to keep India’s energy lifelines secure in an increasingly uncertain world.

Rupee Slides as Trump Tariff Deadline Adds Uncertainty.

The Indian rupee opened weaker on Tuesday, slipping to 85.59 against the dollar, as US President Donald Trump stuck to his July 9 deadline for new tariffs, reviving jitters about global trade flows. The move added to the rupee’s cautious drift lower this year, with the currency down about 0.18 percent so far in 2025.

Most Asian currencies edged lower as Trump ruled out any extension of the tariff timeline, even as he hinted at an imminent India-US trade deal that could feature “much lower tariffs.” For India, the outcome could have broader macro implications, balancing the prospect of reduced trade barriers with the risk of heightened volatility in export-dependent sectors.

Currency markets are likely to remain range-bound near term, analysts say, with the rupee expected to trade between 85.35 and 85.95. Traders are watching whether the Reserve Bank of India will step in more actively, especially as its net short dollar forward book fell further to $45 billion (₹3.9 trillion) by end-May, reflecting a measured pullback in FX intervention.

Global cues remain critical. Investors will monitor key US jobs data and Federal Reserve commentary, with Chair Jerome Powell recently noting that the central bank would have likely moved to cut rates if not for Trump’s tariff brinkmanship. Meanwhile, the dollar index extended its losses on renewed trade tension, underscoring the delicate balance India faces as it navigates external headwinds and currency stability ahead of a pivotal policy period.

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Gupshup.

Macro

• Ghana will seek India’s help to build a vaccine production hub during PM Modi’s visit this week, aiming to leverage India’s pharma expertise as it targets self-sufficiency in inoculations by 2030. Talks will also cover agriculture, defense, and critical minerals.

• India’s RBI is allowing more rupee volatility under Governor Malhotra, pushing companies to ramp up currency hedging and better manage forex risks. Daily trading ranges and a key volatility gauge have jumped as the central bank limits interventions to controlling sharp swings.

• India’s renewable power output grew 24.4 percent in the first half of 2025, its fastest pace in three years, as coal generation dipped and renewables hit a record 17 percent share of total power in June. Analysts expect capacity additions to keep rising this year.

Equities

• HDB’s $1.5 billion (₹128.4 billion) IPO highlights strong investor appetite for large listings in India, even as returns from billion-dollar debuts have been mixed in recent years. The listing comes amid broader challenges for banks, IT firms, and property developers as they navigate slowing growth, cost pressures, and shifting demand trends.

• Biocon plans to lead copycat sales of Novo Nordisk’s weight-loss drug Wegovy in Canada from 2026 and will soon start trials in India, aiming to tap under-penetrated emerging markets as global patents expire. The firm expects limited price erosion in India’s crowded market, banking on its insulin expertise to stay ahead.

• India’s Max Financial Services said its unit, Axis Max Life Insurance, received a warning about unauthorized access to some customer data. The company has launched a security audit and investigation with experts to find the source and fix any issues.

• A Hong Kong-based investor, Harindarpal Singh Banga and family, plan to sell about $150 million (₹12.8 billion) worth of shares in India’s Nykaa through a block deal, NDTV Profit reported. The sale is expected at around a 4 percent discount to the current market price.

• Cipla is in talks to add at least two new overseas markets for products from its China factory to ease production limits in India, a company executive said. Its Jiangsu plant, opened in 2024 to supply the US, can produce about 55 million inhaler units a year.

• Travel Food Services plans to raise about $233 million (₹19.9 billion) through a July 7 IPO that could value the airport restaurant operator at $1.69 billion (₹144.7 billion). The share sale will see its top shareholder, Kapur Family Trust, offload shares, as India’s IPO market gains momentum.

Alts

• After the deadly Air India crash in Ahmedabad, private jet owners are ramping up safety checks, with many planes undergoing special audits and routine inspections being brought forward. The disaster has sparked widespread scrutiny of India’s aviation sector, with jet owners, including billionaire families, hiring consultants to probe airport safety and the regulator uncovering maintenance lapses industry-wide.

• Foxconn has pulled hundreds of Chinese engineers from its iPhone factories in India, posing a setback for Apple’s push to expand production in the country. The move is expected to slow local workforce training and tech transfer from China, potentially raising costs just as India ramps up output for the new iPhone 17.

• India’s Dorf-Ketal Chemicals is in talks to raise about $500 million (₹42.8 billion) in private credit to help fund its biggest-ever deal, the acquisition of a European peer, ahead of its planned IPO, sources told Reuters. Term sheets with lenders could be signed as soon as this month.

Policy

• An RBI panel is likely to recommend India keep its 4 percent inflation target with a 2 percent-6 percent band and continue using headline CPI, backing the existing framework that’s helped manage price swings. Final proposals will go to the Finance Ministry by September for a new five-year plan.

• State Bank of India has flagged Reliance Communications’ loan account as fraudulent over alleged fund diversion, the company disclosed. The insolvent firm, with $4.7 billion in debt, now faces potential criminal action and a five-year ban on new bank financing.

• The US, India, Australia, and Japan have launched a new Quad Critical Minerals Initiative to reduce reliance on China, even as trade tensions and tariffs test their ties. India’s Foreign Minister Jaishankar stressed the importance of keeping a positive momentum in relations with the US.

See you Thursday.

Written by Eshaan Chanda & Yash Tibrewal. Edited by Shreyas Sinha.

Disclaimer: This is not financial advice or recommendation for any investment. The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.