📰India's LG IPO Goes Global | Daily India Briefing

Today’s deep dives: India’s LG IPO has attracted impressive foreign investors. Tata Consultancy Services (TCS) is set to be the first major Indian IT firm to report earnings following Donald Trump’s decision to sharply raise H-1B visa fees. India is considering a one-time settlement of Vodafone Idea.

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Macro

• Heavy flooding and landslides have led to over 20 deaths in east India. Two iron bridges also collapsed in the state of West Bengal from the floods, with the Darjeeling area especially hit. 

• Low company inventories and rising input costs could make their way to customers.Raw materials for staples are rising while company inventories are dwindling. A rise in costs would be passed down to consumers given the lower GST and inflation backdrop leading to increased customer demand in the past few weeks.

Equities

• Tata Capital is set to take orders for the $1.7 billion (₹147.9 billion) IPO, valuing it at $15.7 billion (₹1.4 trillion). The shares are expected to start trading October 13 and the shadow lender would be the highest valued public company of its type. 

• Increased IPO buzz is drawing liquidity away from listed securities. The expected $5 billion (₹435 billion) of raises in October will help set a new monthly record, but listed equities are still set to underperform versus Asian peers. Trading volume is also down for those equities. 

• Banks' net interest margin is expected to hit a trough and rebound this quarter. Expect a 10 basis point contraction based on smaller loan volume and smaller treasury gains. Easing funding costs and a resulting pick-up in demand should lead to margins slowly growing again. 

• Micro-cap, $15 million (₹1.3 billion) IPOs used to lead established IPOs but have started to falter.More than 600 tiny companies listed since 2019 and they outperformed the NSE by a 1,000 percent since 2021. In 2025, a reversal has finally been seen with the NSE outperforming by 7 percent.

Alts

• The Directorate General of Civil Aviation is investigating why an Air India flight had emergency power turned on. The flight was from Amritsar to Birmingham and had no other anomalies throughout, and was able to land safely. Emergency power turning on led to an Air India crash last month leading to over 200 deaths in an Ahmedabad flight. 

• Bharti Telecom is mulling a debt raise of $1.7 billion (₹150 billion) for next week. Both tenor and pricing have not been decided yet but the debt would go towards further investment plans. The company finished its 5G rollout late last year and is expanding service offerings. 

• SEBI is starting to regulate family offices by disclosing assets and returns for the first time. The organization wants more clarity into how offices invest in publicly traded securities. They already began meeting with these family offices but have not established any formal frameworks for regulation yet.

Policy

• Pakistan hailed its Chinese arms as performing 'exceptionally well' against the Indian military. General Chaudhry also hinted at buying more Chinese arms for the country. True performance for both sides is hard to tell since both India and China are masking how many planes they downed and how many were lost. 

• ​​UK PM Starmer is set to visit India this week. He and Modi will discuss the India-UK Comprehensive Strategic Partnership which is meant to increase trust between the UK and India across a range of issues. It will also engage with businesses following a FTA struck in July.

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1. Foreign Investor Interest in LG Stokes IPO Optimism

LG Electronics’s Indian IPO has attracted the sovereign wealth funds of Abu Dhabi, Norway and Singapore, according to people familiar with the matter.

Abu Dhabi Investment Authority, Norges Bank Investment Management and GIC Pte. are in talks to buy shares in the $1.3 billion (₹113.1 billion) IPO as anchor investors. BlackRock and Fidelity are also slated to be part of the anchor book, they said.

India’s largest fund managers including SBI Mutual Fund, ICICI Prudential Asset Management and Nippon Life India Asset Management are set to invest as well, according to the people, who added that the makeup of anchor investors may change as deliberations are ongoing.

The South Korean company’s listing would cap a nearly yearlong process since its December filing that has seen delays amid market volatility and global trade uncertainties. An IPO at the top of the price range would value the India unit at $8.7 billion (₹756.9 billion), significantly below the $15 billion (₹1.3 trillion) it sought in December.

LG is tapping the market in what is set to be a record month for Indian IPOs, with proceeds expected to cross $5 billion (₹435 billion) in October. A successful deal would further raise confidence that India’s $5 trillion (₹435 trillion) stock market can absorb large deals even as US tariffs and weak earnings have left equities trailing other Asian markets this year.

LG started taking IPO orders from anchor investors on Monday and will list its shares on Oct. 14.

2. TCS is the First H-1B Affected Company to Report Earnings

India’s diesel shipments to Europe surged to an all-time high in September as refiners redirected fuel to cash in on stronger margins in the West during refinery maintenance season, according to shiptracking data and trade sources.

Exports to Europe totaled between 1.3 million and 1.4 million metric tons (9.7–10.4 million barrels), the highest since records began in 2017, data from LSEG, Kpler and two industry sources showed. Total diesel exports reached nearly 3 million tons, the highest in five years.

The jump was fueled by a widening East–West price spread, which averaged $45 per ton last month versus less than $30 in August, making Europe the more profitable market. At the same time, shipping costs fell by roughly $10 per ton, further boosting arbitrage flows.

European refineries cut crude runs by some 400,000 barrels per day in September, with capacity outages expected to rise to as much as 600,000 bpd in October. Traders said that shortage tightened European supply, while in Asia the redirected barrels pushed up premiums for 10-ppm sulphur gasoil to a two-month high.

Analysts cautioned that India’s diesel exports may ease in October as domestic demand rises during the Diwali festival season. However, high product margins could keep export-oriented refiners running hard, maintaining flows to Europe despite uncertainties over upcoming EU sanctions on fuels derived from Russian crude.

3. India Wants a Settlement with Vodafone

India is considering a one-time settlement of Vodafone Idea’s long-running adjusted gross revenue (AGR) dispute, allowing the country to waive interest and penalties and reduce the principal amount due. The move could resolve a nearly $22.5 billion (₹2 trillion) standoff that has hobbled the carrier and dented India’s investment reputation for over a decade.

The proposal, still under discussion, comes at a politically and diplomatically strategic juncture. With UK Prime Minister Keir Starmer set to visit India following the conclusion of a new trade pact, New Delhi appears eager to signal policy pragmatism and investor friendliness to its British counterpart. The timing also reflects a recalibration of India’s global alignments: as ties with Washington fray under U.S. protectionism and relations with Beijing cautiously thaw, India is seeking to anchor economic engagement with London as part of a broader diversification strategy. The parent company Vodafone is a British company, hence why the settlement could boost trade ties.

For Vodafone Idea (India’s third-largest telecom operator and a key rival to Reliance Jio and Bharti Airtel) a settlement would be transformational. The company has not reported a profit since 2016 and remains starved of capital, but clarity on AGR dues could unlock fresh investor participation. The government itself now owns 49 percent of the company through a debt-for-equity swap, aligning public fiscal interests with corporate survival.

The dispute stems from the government’s interpretation of adjusted gross revenue, which telecom firms share as license and spectrum fees. The Supreme Court previously ruled against carriers seeking waivers, but a revised government stance could alter the judicial calculus. Officials are drafting frameworks to ensure legal defensibility and parity across the sector — potentially requiring revival plans from all operators, including Airtel and Tata Group, in exchange for relief.

Strategically, the settlement would mark India’s most significant telecom-sector intervention since its partial nationalization of Vodafone Idea. It would also send a powerful signal to foreign investors wary of regulatory unpredictability showing that India is willing to balance fiscal recovery with market stability when strategic partnerships are at stake.

See you tomorrow.

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

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