Borrowed time: Investors bullish on near-term upside increase leveraged bets on Tata Motors, SBI, HAL, Jio Financial
Mumbai: Indian investors are taking on more leveraged bets in the equity markets through margin trading, suggesting a near-term upside, as they put concerns over global and domestic headwinds behind them.
Margin trading, which allows investors to borrow funds to buy or sell securities without paying the full amount upfront, has rebounded to levels last seen during the previous market peak in September, driven by improved sentiment among retail investors and high net-worth individuals.
The National Stock Exchange of India's Margin Trading Facility book stood at ₹81,217 crore as of 6 June, almost at the level of ₹81,728 crore on 26 September. The amount had declined to ₹68,004 crore on 7 April, when the Nifty 50 index declined 3.24% in a single day on the back of fears of a global trade war.
Shares of Tata Motors, Jio Financial Services, Hindustan Aeronautics, State Bank of India, and Mazagaon Docks were the most popular among retail investors and HNIs through the MTF route, the NSE data showed. The amount financed for Tata Motors as of 6 June was ₹1,282 crore, while it was ₹1,119 crore for Jio Financial Services and ₹1,055 crore for Hindustan Aeronautics.
Also Read | How gains through margin trading facility transactions are taxed in India
Experts said that the increase in the MTF book shows that investors are taking a positive near-term view of the markets. The recent Reserve Bank of India 50 basis point repo rate cut will also allow brokers, who provide this facility to clients, more room to pass on the benefits to investors. By maintaining their spreads and offering lower rates, brokers are expected to attract greater participation in margin trading.
Tariffs, border tension
Nirav Karkera, head of research at wealth tech platform Fisdom, said that a combination of domestic and global headwinds had earlier weighed on investor sentiment. Globally, risks were mounting with the prolonged Russia-Ukraine conflict and tariff-related uncertainties, he said, adding that on the domestic front, border tensions added to the anxiety.
'Domestic inflation wasn't easing, there was no clarity on the interest rate trajectory, and corporate earnings were dismal," said Karkera. 'There was little reason for optimism in the markets, and more than enough for investors to go light on leveraged positions through MTF."
Karkera also said that MTF is highly sensitive to interest rates.
Also Read | The Reserve Bank's growth stimulus is a bold bet on price stability
'When the borrowing rates come down after the 50-basis points rate cut—it could further boost interest in MTF. While a cut in the repo rate doesn't immediately reduce MTF rates, it does lower the cost of funds for brokers, who may then refinance at lower rates," he said.
On 6 June, the RBI's six-member Monetary Policy Committee slashed the repo rate to 5.5%, its third consecutive cut since February.
Positive sentiment
Others said the MTF book is a gauge of market sentiment. Feroze Azeez, joint chief executive officer at Anand Rathi Wealth Ltd, said the MTF book should be seen more as a barometer of broader market sentiment than a reliable indicator of market direction. Azeez said that after months of volatility, investors have started becoming a lot more mature.
'The buy-on-dip strategy has become popular, and with easier access to leverage, more investors are using MTF to build positions, which also shows positive conviction in the market," said Azeez. He added that people are taking a view that the markets will continue to do well, at least in the near term.
Also Read | Sebi seeks more details from bourses before options date shift
The market's decline after September 2024 also coincided with a shift in the futures and options expiry structure, which led to a decline in derivative volumes, according to Trivesh D, chief operating officer at trading platform Tradejini.
However, as the market began recovering in February, there was a resurgence in both F&O and cash market volumes. This uptick in trading activity improved price discovery, further driving investor participation in margin trading, he added.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Hindustan Times
30 minutes ago
- Hindustan Times
We're not erratic or volatile, Germany reliable partner for Indian students: Ambassador Ackermann
New Delhi, Germany has been a reliable partner for Indian students for a long time, and it is not "erratic" or "volatile" but very steady, Ambassador Philipp Ackermann said here on Tuesday, while asserting that his country wants the "smartest and the brightest" from India. His comments come in the backdrop of difficulties faced by international students, including from India, on matters related to academic admissions for higher studies in some countries, and student visa procedures. Interacting with reporters at his residence here, Ackermann said over 50,000 Indian students are currently in Germany pursuing higher studies, and "our experience is that number will rise". Without naming any country, the German envoy to India also indicated that more Indian students were likely to choose Germany as an academic destination, in view of the issues faced by them currently in the context of other countries. "In the light of... with student admissions and student visa procedures in some countries, it is maybe a good time to state that Germany is eager and happy to receive Indian students," he said in his opening remarks. He mentioned multiple times that his country has been a "reliable partner" for Indian students, and even added that "we don't check social media before you come". "We feel that Germany has been a reliable partner for Indian students for a long, long time. And, will remain so. We are interested in Indian talent, we are interested in Indian brains. We are interested in those Indians who really want to achieve something, and Germany will always be a partner for such people. So, we are not erratic, we are not volatile, we are very, very steady," Ackermann said. He also underlined that Germany offers first-class education, and those are willing to study hard to achieve it, are "welcome" and can "count on us". "And, we are eager on having talented young Indians coming to Germany," the envoy added. German universities and German research institutions have made "extremely good experiences" with students, and it has been seen that the number of Indian students is increasing every year in universities, and universities of applied sciences have also accepted a growing number of Indian students, the ambassador said. "We are talking about 50,000 plus Indian students in Germany, and our experience is that number will rise. We already now feel that more Indian students.. and that is certainly in the context of difficulty they face in other countries, and that more Indian students are interested to join German universities and German research institutions," the envoy said. Representatives of various top German universities such as Cologne University, University of Gottingen, Freie Universitaet Berlin, and research institute like the Max Planck Society and Fraunhofer were also present on the occasion. Later in an interaction with PTI Videos, the envoy said academic cooperation is a key pillar in the India-German bilateral ties. "We are searching Indian talent, and this is a time where many Indian students who had ideas to go elsewhere, now have second thoughts, and don't get where they really... wanted to go. So, what I am saying is, look at Germany, if you want a first class education, in many, many areas, above all in STEM area, German universities offer a broad range of possibilities, English-taught possibilities, with the clear perspective to join labour market in Germany after that," he said. "So, we have been a reliable partner for India in the last couple of decades... but what is important for me is to say that we want the smartest, the brightest from India," Ackermann told PTI. The envoy said the "offer is on the table", there is a clear growing interest. "Also, we want to encourage every student to individually search for universities, avoiding agents who will offer you a complete package, which sometimes is not a satisfaction," he said. Katja Lasch, Director, DAAD Regional Office, New Delhi, also interacted with the reporters. DAAD German Academic Exchange Service is marking its centenary this year, while its India office was set up 65 years ago. She said "applications to universities" have increased by over 30 per cent in the last couple of months, compared to the last academic year, citing data from DAAD. Lasch said there are about 425 universities, out of which there are 305 public universities. Germany has about 400,000 international students and it offers 2,300 study programmes in English language, she added. And, the country is among the top five destinations for Indian students along with the US, Canada, the UK, Australia. Ackermann said German education system is "widely a public good", which means most universities don't charge for studies and if they charge, the state-run universities, it's a small fee, compared to fees charged by universities in Anglo-Saxon countries. "So, its merit-based not money-based approach," he added. On a query on German visa issues, the envoy said, "There is no backlog anymore . Two years ago, we had a huge backlog.. we changed our system." Asked about the new citizenship rules by the German government, the ambassador clarified that "the government has not make a U-turn on citizenship, there was a very short way to citizenship within three years, this has been blocked now. Now, it is five years".
The Hindu
31 minutes ago
- The Hindu
VinFast's India strategy will have an entire EV ecosystem, including strong dealership presence in Tier two and three cities
I recently had the opportunity to visit VinFast's headquarters in Hai Phong, Vietnam—a sprawling, vertically integrated manufacturing complex that reflects the company's global ambitions. While there, I experienced the two models that will spearhead VinFast's entry into India: the VF6 and VF7. I also got an inside look at how VinFast builds its cars,how it plans to build its presence in a competitive and complex market like India. Scale, Strategy, and Manufacturing Muscle VinFast's entry into India is a strategic one, and it comes with real investment. The company is setting up a manufacturing facility in Tuticorin, Tamil Nadu, with an initial capacity of 50,000 vehicles per year, scalable to 150,000 units annually. With an investment of up to USD 500 million, this is not a soft launch—it is a full-fledged push into what is one of the world's most promising auto markets. The India strategy is not just about assembling cars. VinFast plans to build an entire EV ecosystem — including charging infrastructure, service networks, and a strong dealership presence spanning both metro and Tier 2 and 3 cities. There is also a clear focus on localisation to improve cost efficiency, aligning with India's 'Make in India' initiative. But ambition alone does not guarantee success — especially in a market where Tata Motors and Mahindra have already established themselves with localised EV offerings, extensive networks, and strong consumer trust. This is where VinFast's products will have to do the talking. VF6: Compact, Connected, and Surprisingly Refined Let us start with the VF6. At 4,241 mm in length and with a 2,730 mm wheelbase, it slots into the compact SUV category. But in terms of presence, it punches above its weight. The stance is confident, and design-wise, it manages to look futuristic without being flashy. Under the skin is a 150 kW (201 bhp) motor that drives the front wheels and puts out 310 Nm of torque. The 0–100 km/h time of 8.89 seconds feels adequate for daily commutes, with a linear throttle response and quick off-the-line acceleration. The 59.6 kWh battery delivers usable range in the region of 400+km, and regenerative braking is adjustable across four levels. What stood out to me during the drive was the ride quality. The MacPherson front and control blade rear suspension setup absorbed bumps well and gave the VF6 a planted, confidence-inspiring feel — something not every EV manages at this size and price point. The cabin is minimal yet feature rich. A 12.9-inch touchscreen anchors the dashboard, controlling most functions. You get wireless Android Auto and Apple CarPlay, dual-zone climate control, air purification, and even ventilated vegan leather seats with eight-way electric adjustment for the driver. The overall execution feels premium, not just for the segment, but even compared to some ICE rivals. Safety is well covered: Seven airbags, adaptive cruise control, lane centering, rear cross traffic alert, and a 360-degree camera system are all included. VinFast clearly is not cutting corners on tech or safety. VF7: Sharper, Stronger, and Segment-Up The VF7 builds on the VF6's platform and takes things up a notch—both in size and performance. At 4,545 mm long and with a 2,840 mm wheelbase, it enters mid-size SUV territory. The styling is sleeker, and details like the flush door handles, panoramic glass roof, and LED signature lighting elevate its street presence. You get two drivetrain options: a single-motor FWD variant with the same 150 kW/310 Nm setup as the VF6, or a dual-motor AWD version with 260 kW (348 bhp) and 500 Nm of torque. The latter hits 0–100 km/h in 5.8 seconds, and that performance is genuinely felt on the road. Acceleration is immediate, and the AWD system adds a sense of grip and stability, particularly useful for highway stints or wet conditions. Like the VF6, the VF7 uses a dedicated EV platform. Its 70.8 kWh battery promises better range, and it supports 7.2 kW AC charging via a CCS2 port. Cabin insulation is good, and ride quality is polished—on par with what you would expect from established global brands. Inside, you get similar tech and creature comforts as in the VF6, but the VF7 adds space and a more premium touch. Reclining rear seats, a powered tailgate, and memory functions for the mirrors and seats are thoughtful touches. The ADAS suite is equally comprehensive, with auto lane change assist, adaptive high beam, and door open warning among the features. Challenges and the Competitive Lens The VF6 and VF7 will enter what is fast becoming a crowded space in India—the compact and mid-size electric SUV segments. These segments are no longer niche, and buyers today are discerning, well-informed, and demanding. They expect their EVs to be more than just green alternatives; they want them to be refined, feature-rich, comfortable, and practical enough to serve as primary vehicles. And on those counts, both the VF6 and VF7 come across as well-rounded machines. Though our experience was limited to the Vinfast factory test track, both vehicles demonstrated a level of chassis maturity, ride comfort, and handling confidence that will likely translate well to Indian driving conditions. Cabin insulation is impressive, build quality is solid, and the tech on board feels well-integrated rather than gimmicky. Practicality too is clearly on VinFast's radar—with usable boot space, roomy interiors, and thoughtful inclusions like drive modes, wireless connectivity, and intuitive interfaces. The true test will be how these cars behave on Indian roads with local load conditions and varying terrains. The driving experience was cohesive — there were no rough edges or incomplete calibrations. Simply put, these are well-engineered EVs that tick the right boxes for modern Indian buyers looking for a balance between sustainability, sophistication, and everyday usability. Brands like Tata and Mahindra already have a strong foothold, with EVs tuned for local preferences and supported by expansive networks. For VinFast, the challenge will be less about proving product strength and more about pricing them wisely, building trust, and executing on after-sales promises. Final Thoughts: Impressive Debut, Real-World Test Awaits From factory floor to tarmac, VinFast has shown that it has the capability to produce high-quality electric vehicles that feel global in execution. The VF6 and VF7, both built on the company's own EV platform, are solid entries into their respective segments—with refined drivetrains, robust safety packages, and contemporary interiors that rival the best in class. But success in India is not just about the product. It is about scale, price, support, and trust. VinFast has a solid foundation to work from, but it now has to deliver on its promises in a market that is both rewarding and unforgiving. The VF6 and VF7 make a strong first impression. With the right strategy, VinFast could well position itself as a serious new contender in the country's fast-evolving EV landscape. Motorscribes, in association with The Hindu, brings you the latest in cars and bikes. Follow them on Instagram on @motorscribes
Mint
32 minutes ago
- Mint
Nifty 50 to reach 26,600 level by 2025-end; IT among top sectors that can create wealth: Achin Goel, Bonanza Group
Expert View: Achin Goel, PMS Fund Manager at Bonanza Group, believes that Nifty 50 can reach at 26,600 level by the end of 2025, helped by 11% EPS growth in Nifty-50 constituent companies. Furthermore, he expects the FII to remain bullish on the Indian stock market as India's solid economic growth and ongoing reforms will mitigate geopolitical risks and maintain strong foreign investor interest. Edited excerpts: India's strong macroeconomic fundamentals are acting as a powerful tailwind for the equity markets. We're seeing a combination of high GDP growth, strong tax collections, manageable inflation, and consistent government capital expenditure—all of which are laying a solid foundation for sustainable earnings growth. From an investor's perspective, this kind of macro stability builds confidence. For example, a disciplined fiscal approach and RBI's measured monetary policy help keep inflation and interest rate volatility in check, which is crucial for long-term equity flows, especially from institutional investors. Moreover, the government's emphasis on infrastructure, manufacturing through PLI schemes and digital public infrastructure is accelerating a multi-sector capex cycle. This directly benefits sectors like capital goods, construction, banking and industrials. In addition, India's demographic dividend and rising middle class continue to support domestic consumption, which strengthens sectors such as FMCG, autos and retail. Put simply, strong macros don't just support the market—they help broaden the rally and deepen sectoral participation, making India one of the attractive investment destinations among emerging markets. The recent stellar run of the smallcap index, which has outperformed the Nifty 50 and large caps with gains like 6.87% in May 2025 and double-digit returns for many stocks, is driven by strong growth potential and renewed investor interest in sectors such as railways, defense, and financials. Smallcaps benefit from their higher growth prospects and are seen as attractive for medium-to long-term investors willing to tolerate higher risk. However, this rally comes amid significant challenges: Q4FY25 smallcap profits contracted by 19%, contrasting with midcap and largecap earnings growth. Earnings downgrades, government capex slowdowns, and sector-specific weaknesses—especially in cement, private banks, consumer, and auto sectors—have raised concerns about sustainability. Thus, while smallcaps offer compelling upside due to valuation discounts and sectoral tailwinds, the earnings misses and macro uncertainties warrant caution. Investors should balance the growth potential against heightened volatility and selectivity risks amid an uneven earnings backdrop. The outlook for Indian IT sector in FY26 appears challenging, primarily due to the impact of discretionary spending cuts in the US amid rising recessionary pressures. The US, which accounts for over half of India's US$190bn software exports, is experiencing a cautious consumer sentiment with many consumers planning to reduce spending on discretionary items. This cautiousness is exacerbated by tariffs imposed by the US administration, which have fueled inflation and heightened fears of a recession. Tariffs, which is not directly targeting IT services, but indirectly affect Indian IT companies as their clients in manufacturing, logistics and retail sectors face higher costs and uncertainty, leading to delayed projects and slower deal cycles. As a result, current scenario is marked by limited new outsourcing opportunities and pressure on margin due to pricing and limited rupee depreciation benefits. However, Indian IT companies specialising in AI, Gen AI and cloud services are poised for robust growth, driven by rapid digital transformation and increasing adoption of AI-as-a-Service and hybrid cloud models. US companies, facing recessionary pressures are intensifying cost optimization efforts by prioritizing scalable, efficient cloud solutions and AI deployments that reduce operational expenses while enhancing productivity. This focus on cost efficiency is influencing Indian IT firms to offer optimized cloud and AI services that align with US clients' budget-conscious strategies. Defence and railway stocks have shown a notable upward movement recently, fueled by strong government initiatives and strategic sectoral developments. Defence stocks are signaling a potential turnaround after previous corrections, supported by India's aggressive push for indigenisation and export growth. Further, Operation Sindoor has significantly boosted investor interest defence stocks, as some of the stocks rising up to 35% shortly after the conflict began. The surge reflects expectations of increased defence spending, replenishment of military inventories and export opportunities driven by India's demonstrated indigenous military strength and technological edge. Meanwhile, railway stocks also rallied strongly on the back of a significant capex push, with government budget allocations of Rs.2.62 lakh crore for railway capital spending in 2025–26 aimed at infrastructure upgrades and electrification projects. However, given the sustained government focus on modernization, 'Make in India' initiatives and technological adoption in both sectors, the upward trend appears poised to continue in the medium term, provided macroeconomic stability and policy continuity remain intact. The ₹ 43,400 crore promoter selloff in May warrants cautious interpretation rather than outright alarm. While the timing coincides with Nifty's 12% surge, this appears driven by liquidity dynamics rather than fundamental concerns. With FIIs and DIIs injecting Rs.80,000 crore, promoters are naturally stepping in to provide supply through block deals, as individual retail investors cannot facilitate large institutional purchases. However, the dichotomy between companies guiding strong growth while promoters dump shares at high valuations does raise questions about insider sentiment. Large-cap withdrawals such as InterGlobe ( ₹ 11,560 crore) and ITC-BAT ( ₹ 12,900 crore) may indicate portfolio rebalancing, while small and midcap promoter selling may be seen with caution and may warrant a deeper analysis. While not strictly a red warning, this pattern suggests that bulls should exercise greater caution given the current values. Many leading brokerages have recently upgraded their Nifty-50 target for the year 2025, reflecting a bullish outlook based on fundamental analysis. This optimism is driven by strong corporate earnings growth, robust economic indicators, and favourable monetary policy with 50bps rate cut by the RBI. FIIs have also turned net buyers amid a weakening dollar index and volatile US bond yields, further supporting market sentiment. On the above thesis, we are also expecting ~11% EPS growth in Nifty-50 constituent companies to reach to ~Rs.1,300 in FY26. On this basis, we are expecting Nifty-50 to reach at 26,600 level, a further upside of 6.5% by end of 2025. Foreign investors have shown renewed confidence in Indian markets, pumping in ₹ 4,223 crore in April followed by a record ₹ 19,860 crore in May 2025, marking the strongest inflows this year. This enthusiasm comes from a mix of positive factors: India's GDP growth surprised everyone with a strong 7.4% in the last quarter, the weakening US dollar made Indian assets more attractive and talks of a possible US–India trade deal have boosted long-term optimism. On top of that, policy changes like easing investment rules for Saudi Arabia's sovereign fund show India's commitment to welcoming foreign capital. While the near-term uncertainties such as geopolitical risks and rising US treasury yields may reverse this trend. However, India's solid economic growth and ongoing reforms will mitigate these risks and maintain strong foreign investor interest in the months ahead. Technology and IT services are top sectors for wealth creation, driven by digital transformation and AI adoption. Renewable energy and electric vehicles benefit from strong global sustainability trends and supportive policies. The pharmaceutical and healthcare sector offers consistent growth due to innovation and export opportunities. Infrastructure development is propelled by urbanization and government projects. Financial services and FinTech are growing through digital inclusion and financial deepening. Lastly, consumer goods thrive on rising middle-class consumption and rural market penetration. Diversifying across these sectors can help investors build and preserve wealth. As of early June 2025, the Indian rupee is stable, trading between ₹ 85.80 and ₹ 86 against the US dollar. It has strengthened slightly by 7 paise, helped by foreign money coming into the country and a soft approach by the RBI. The RBI surprised everyone by cutting the repo rate by 0.5% to 5.5%—its biggest cut in five years. It also reduced the CRR by 1%. This shows the RBI is confident because inflation in India has fallen to about 3.16% in May, which is low and manageable. A weaker US dollar, lower inflation in India, and cheaper oil prices have reduced India's import costs. This helps the economy since India imports a lot of oil and goods priced in dollars. Exporters, especially in IT and pharma, could benefit as their products become more competitive globally. However, their earnings in dollars may be worth less in rupees. Upcoming US job data could also affect how strong or weak the dollar remains and influence investment into countries like India. Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
