📰Trade Talks Reignite | Daily India Briefing

U.S. and India trade talks reignite. Indian stock exchanges hit 2-month high. The valuation of India’s commodity exchange doubles.

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Macro

• India’s recent goods and services tax cut is boosting urban consumption, with consumer staples benefiting from stronger volumes and price reductions. Auto stocks have emerged as key winners, with expectations of higher demand making the sector this year’s best performer.

• India’s LNG demand is set to contract in 2025 for the first time in years, with imports down 10 percent so far as buyers await cheaper supply from upcoming projects. Analysts expect demand to rebound from 2026, potentially doubling by 2030.

Equities

• Groww’s parent, Billionbrains Garage Ventures, has filed for an IPO in Mumbai, aiming to raise up to $800 million (₹70.4 billion) at an $8 billion (₹703 billion) valuation. Backed by Satya Nadella, the listing includes new shares and investor sell-downs, positioning Groww as India’s largest brokerage.

• A cyberattack that shut down Jaguar Land Rover plants for a third week is now hitting suppliers, with firms like Germany’s Eberspächer halting output in Slovakia and others scaling back. JLR factories will stay closed until at least Sept. 24.

• SpiceJet will lease eight more Boeing 737s to expand capacity ahead of India’s festive and winter travel season, bringing total recent fleet additions to 18 aircraft. The struggling budget carrier continues to face financial pressures despite settlements with creditors.

• Vedanta will maintain coal as the backbone of its energy use, with the fuel making up about 70 percent of its power mix, even as it gradually increases renewables. CEO Deshnee Naidoo said the company aims to balance cost and sustainability.

• Dreamfolks Services has halted domestic airport lounge services in India but will continue its other local offerings and global lounge business. The company warned the move will have a material financial impact, though it didn’t provide further details.

• Nayara Energy has increased fuel supplies to state-run HPCL after EU sanctions curbed its exports, operating its Vadinar refinery at 70–80 percent capacity. Boosting local sales is helping the Russian-backed refiner sustain production despite international restrictions.

Alts

• Thyssenkrupp has received a takeover offer from India’s Jindal for its struggling steel unit, long burdened by high energy costs and weak prices. Jindal pledged funds and green tech upgrades, including hydrogen-based ironmaking, to position it as Europe’s top low-emission steel producer.

Policy

• India plans $454 million (₹40 billion) in incentives from 2026 to boost its shipbreaking industry and challenge Bangladesh’s dominance. Perks include credit notes worth 40 percent of scrap value, a possible east coast facility, and a $2.8 billion (₹250 billion) maritime fund to spur shipbuilding.

• India’s pension regulator will allow fund houses to launch tailor-made investment plans, letting subscribers hold multiple programs instead of just one. The $175 billion (Rs15.4 trillion) industry overhaul aims to boost personalization, widen investor choice, and attract more innovation and foreign capital.

• Indian antitrust officials raided Jindal SAW and Maharashtra Seamless over alleged bid rigging in steel pipe tenders, following a 2023 complaint by ONGC. Both firms’ shares fell after the raids, with Jindal SAW confirming cooperation while the probe continues.

• India’s antitrust regulator has approved JSW Paints’ plan to acquire up to 75 percent of Akzo Nobel India. The deal, announced in June, comes as the paint sector faces higher input costs and heightened competition among local and global players.

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1. U.S. and India Reignite Trade Talks

The United States and India described their latest trade discussions as “positive” on Tuesday, signaling a potential thaw after weeks of tensions sparked by Washington’s steep tariffs on Indian exports.

Negotiators met in New Delhi for a one-day round of talks led by Brendan Lynch, assistant US trade representative, and Rajesh Agrawal, India’s chief negotiator. Both governments said the meeting was “forward looking” and committed to “intensify efforts” toward a deal.

The renewed dialogue follows Trump’s decision last month to impose 50 percent tariffs on Indian goods, the highest in Asia, in response to trade barriers and New Delhi’s continued purchases of Russian oil. India insists its Russian imports are based on affordability and energy security, setting up a key sticking point in the negotiations. India is also not the largest buyer of Russian oil, which is China, enjoying a lower overall tariff rate despite the fact.

The discussions come alongside a planned visit by US defense officials and Boeing executives to India to finalize a $4 billion (₹352 billion) sale of naval surveillance aircraft, underscoring that strategic ties remain active despite trade friction.

Analysts caution progress could be slow. “The resumption of talks is positive, but it will be difficult to find common ground between US aspirations and India’s core concerns,” said Abhijit Das, a former Indian trade official.

Trump has said he will speak with Prime Minister Narendra Modi in the coming weeks. India has reiterated that it will continue buying Russian oil as long as it remains financially viable.

2. Indian Stock Exchanges Hit 2-Month High

Indian equity benchmarks closed at their highest in two months on Tuesday, lifted by autos and energy shares, as optimism over trade talks with the United States and expectations of a Federal Reserve rate cut boosted sentiment.

The NSE Nifty 50 rose 0.68 percent to 25,239.1, its highest since July 10, while the BSE Sensex gained 0.73 percent to 82,380.69, the strongest close since July 23.

Autos led the rally, with the sectoral index climbing 1.4 percent after five sessions of losses. Mahindra & Mahindra surged 2.2 percent, while Hyundai Motor India, TVS Motors, and Ashok Leyland also advanced. Analysts at Nomura cited early signs of demand recovery following Goods and Services Tax (GST) cuts, highlighting these automakers as top picks.

Energy shares extended their winning streak to a fifth day, rising 0.9 percent on expectations of government support for oil marketing firms and resilient fuel demand. NTPC Green Energy gained 1.7 percent after a joint venture commissioned a 100 MW project.

3. Indian Commodity Exchange Doubles in Value

The valuation of India’s National Commodity & Derivatives Exchange (NCDEX) has surged, with unlisted shares now changing hands for more than double the price seen just weeks ago, as global trading firms buy in ahead of the exchange’s foray into equities.

Shares in NCDEX, the country’s primary platform for trading agricultural commodities, are trading at around 485 rupees apiece in India’s gray market, according to people familiar with the deals. That values the exchange at roughly $495 million (₹43.6 billion), more than twice the level implied by its late-August share sale to select investors.

The renewed buzz around NCDEX follows its $87 million (₹7.7 billion) capital raise from global market heavyweights, including Citadel Securities and Tower Research. The funds are expected to bolster the exchange’s technology capabilities and support its diversification into equity-linked products, for which it received preliminary approval from India’s market regulator earlier this year.

The move would place NCDEX in direct competition with India’s dominant exchanges, the National Stock Exchange (NSE) and BSE. The heightened demand for its unlisted shares highlights both investor confidence and the appetite for exposure to India’s expanding financial markets even before a public listing.

However, regulators have warned about speculative excesses, noting that Indian retail investors lost over $12 billion (₹1.1 trillion) trading derivatives in the year through March despite curbs aimed at cooling the frenzy.

See you tomorrow.

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

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