Newsletter
Policybazaar gains, US-China cool, and PhonePe scores.
🗓 Morning, folks!
Indian markets slipped on Thursday as investors turned cautious after Fed Chair Jerome Powell hinted that more US rate cuts may not be coming soon.
The weakness in large-cap stocks and mixed earnings also kept traders on edge, dragging benchmarks lower.
Pharma stocks led the fall, with Dr Reddy’s Labs tumbling the most on worries around new diabetes drug developments, while Cipla slid nearly 3% after CEO Umang Vohra announced his exit.
On the brighter side, Coal India rose almost 2% on firm coal prices, emerging as the top Nifty gainer. Broader markets were subdued, with midcaps and smallcaps showing little spark as sentiment stayed risk-off.
💡 Spotlight: Fed cuts rates, but not too fast 💵
The US Federal Reserve cut interest rates by 0.25%, bringing them down to a range of 3.75–4%.
But Fed chair Jerome Powell made it clear that this doesn’t mean more rate cuts are guaranteed. He said the next move in December is “not a sure thing,” since officials are split on what to do next.
The vote itself showed the divide, some wanted a bigger cut, others wanted none at all. Markets didn’t get too excited as the Dow fell 0.2%, the S&P 500 stayed flat, and the Nasdaq inched up 0.6% to a record.
Let’s hit it!
1 Big Thing: BHEL profit surges 253% on power boost ⚙️
BHEL’s Q2 profit soared 253% YoY, driven by strong power demand, higher order execution, and improved operational efficiency. The stock jumped more than 6% reacting to the strong result.
By the numbers: revenue from operations rose 14% YoY to ₹7,511.8 crore
- Net profit jumped 253% to ₹374.9 crore from ₹106.1 crore last year.
- The power business was up 13% while the industry segment jumped 18% YoY.
The how: the stellar quarter came from a mix of strong project execution, higher demand in the power and industrial segments, and better cost control.
The company benefited from accelerated government spending on infrastructure and power generation, which boosted equipment orders. Its power division & industrial segment showed balanced growth across verticals.
Zoom out: India’s power equipment industry is buzzing, thanks to renewable energy expansion, government capex, and the push for domestic manufacturing.
With the country targeting 500 GW of non-fossil energy capacity by 2030, BHEL’s engineering muscle might just keep humming for a while.
While we are on earnings,
PB Fintech, the parent of Policybazaar, delivered a standout quarter, led by insurance demand and tighter cost control.
Breaking it down: consolidated revenue jumped 38% YoY while profit after tax surged 164% YoY to ₹134.9 crore.
- Total insurance premium rose 40% YoY, led by a 60% surge in health insurance and a 44% jump in term coverage.
- Margins expanded from 5% to 10%.
The strong show was driven by higher insurance penetration, renewal revenues, and tight cost discipline across marketing and employee spends. The company’s lending arm also delivered with Paisabazaar’s loan disbursals soaring 102% YoY.
2. US-China ease trade tensions, agree on renewed cooperation 🌏
The US announced it will cut tariffs to 47% from 57% and lift curbs on rare earth exports, while China vowed to curb fentanyl exports and restart large farm purchases like soybeans.
The breakthrough came as Donald Trump and Xi Jinping met in South Korea, marking their most constructive discussion in months.
For months, the two biggest economies have been caught in a trade and tech war, slapping tariffs, banning apps, and blocking exports. But after a 100-minute meeting in Busan, both the leaders agreed to reset ties.
Through the deal, US gets China’s help to curb fentanyl, a deadly synthetic drug driving America’s overdose crisis, while China gains relief from high tariffs and export restrictions that have hurt its economy.
Xi Jinping put it as, “I am ready to continue working with you to build a solid foundation for China-U.S. relations.”
India angle: for India, the thaw is good news too. A calmer trade environment means more stable commodity prices and smoother supply chains.
Expect a positive ripple for metal, chemical, and export-driven stocks with names like Tata Steel, JSW Steel, and Adani Ports likely to benefit as global trade gets a breather.
3. US sees mixed tech earnings, Alphabet shines while Meta stumbles 💻
It was a mixed bag for big tech companies this week with Alphabet soaring, Microsoft steadying, and Meta stumbling.
Results summary: Alphabet stole the show, with shares jumping 6.2% after quarterly revenue crossed the $100 billion mark for the first time ever.
The credit goes to steady ad growth and a booming cloud business, while earnings per share of $3.1 easily beat estimates.
Microsoft’s story was a bit more muted. Despite a 22% profit jump to $30.8 billion and stronger-than-expected cloud revenue, its stock slipped 3.4% in after-hours trading.
Investors were hoping for even bigger fireworks from its AI push but the company’s solid performance proves that AI is now more business than buzz.
Meta, on the other hand, had a rough quarter. Its stock tumbled 8% after a massive $16 billion one-time charge linked to Trump’s so-called “Big Beautiful Bill.”
Revenue still grew 26% year-on-year, the fastest in over a year, but CEO Mark Zuckerberg’s AI obsession and warning of much higher spending next year spooked investors.
4. General Atlantic gives PhonePe a $600 million boost 💸
General Atlantic invested $600 million in PhonePe, doubling its stake from 4.4% to 9% in the IPO-bound company.
General Atlantic is a US-based private equity firm that provides capital and strategic support to companies across sectors like healthcare and fintech.
The deets: the funds will be utilised to help fulfill their tax obligations from exercising Employee Stock Options (ESOPs) ahead of the IPO. With this, General Atlantic’s investment in PhonePe stands at $1.1 billion.
Big picture: the funding also reflects international interest in India’s booming fintech landscape where owing to wide-scale adoption of UPI, 85% of transactions in the country happen digitally. India also plans to add 300 million new users to this, making it a lucrative market to delve into.
The road ahead: while PhonePe boasts robust revenue growth of 40% YoY and positive cash flow, it continues to face intense competition and challenges on the profitability front.
To offset this, PhonePe is actively expanding into new verticals such as mutual fund and insurance investments to drive scale and strengthen margins to ensure a promising IPO.
While we are on fundraises,
Amway is going to invest ₹100 crore in India to push distribution efforts.
Amway is a US-based company that manufactures and sells health, beauty and homecare products through a multi-level marketing model.
The deets: the main aim is to expand distribution through direct sellers and kickstart physical stores. India is one of the three manufacturing hubs for the company and a key driver for its growth.
CEO and President of Amway Michael Nelson said, “India is a powerhouse of potential driven by its digitally empowered population, a dynamic and young workforce, and thriving gig economy.”
Zoom out: the company has been struggling to achieve profitability with its India business as total income grew a meagre 0.7% in FY24. In the past, the company had also been embroiled in regulatory tussles with the Enforcement Directorate.
5. Stock that kept us interested 🚀
1. Welspun’s US arm bags $715M pipeline orders 💰
Welspun Corp’s US subsidiary landed two major orders worth $715 million to supply coated pipes for Natural Gas and NGL pipeline projects in the US. The stock rose 2% after the announcement, reflecting investor confidence in this global push.
Coated pipes are steel pipes covered with a protective layer to prevent corrosion, leakage, or damage when used to transport oil, gas, or other fluids underground or underwater.
What’s the deal: in this case, the US will use the company’s coated pipes to build or expand its gas and energy pipeline network. These projects aim to improve domestic energy transportation, support rising demand for cleaner fuels, and strengthen exports of natural gas and related products.
The win boosts Welspun’s total order book to ₹23,500 crore and strengthens its footprint in one of the world’s largest energy markets.
What else are we snackin’ 🍿
🤝 AI alliance: Wipro teamed up with HanesBrands to power its IT 2.0 transformation using Wipro’s AI platform, Intelligence WINGS.
🤖 Global impact: Kellton Tech partnered with the UNFPA to build Generative AI solutions driving digital innovation and accelerating progress toward global development goals.
And that’s a wrap. Pour yourself an extra one this weekend.
We’ll be back like clockwork on Monday!
Hit that 💚 if you liked this issue.
