# 1 Markets
The Indian equity market last week witnessed a cautious and subdued trend with the Sensex closing around 83,216 and the Nifty 50 near 25,492, after retreating from recent highs amid weak global cues and profit-booking. Financials and metals sectors showed resilience and led gains, while FMCG and IT sectors faced selling pressure. Persistent FII outflows were cushioned by DII buying, as the market steadied near key support levels awaiting fresh triggers.
The Indian bond market last week remained largely steady with the 10-year government bond yield rising marginally to around 6.52% amid cautious trading ahead of a large debt auction and uncertainty over the RBI’s policy stance.
The US equity market last week saw a broad sell-off driven by concerns over stretched valuations in AI stocks and the ongoing government shutdown, leading to fresh profit-taking. The S&P 500 fell 1.1% to 6,720, the Nasdaq dropped 1.9%, and the Dow lost 0.8%, reflecting caution amid disappointing labour market data and lack of fresh economic indicators.
The US bond market last week saw the 10-year Treasury yield slightly ease to around 4.11% amidst mixed economic signals, including weaker labour market data that raised expectations for a Fed rate cut next month.
# 2 Banking
2.1 Highlights from CRIF High Mark report on MFI – Q2fy2025
- Total microfinance portfolio declined 16.5% YoY to ₹3.45 lakh crore (from ₹4.14 lakh crore) and 3.8% QoQ (from ₹3.59 lakh crore).
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- Active microloan accounts fell 19.3% YoY and 6.3% QoQ to 12.4 crore.
- Disbursements rose 6.5% QoQ to ₹60,900 crore (vs ₹57,168 crore in Q1).
- Loans of ₹50,000–1 lakh formed the bulk of disbursements.
- Loans above ₹1 lakh doubled their share to 15% YoY, led by banks and NBFCs.
- PAR ≤30 days fell to 1.41% (from 1.56% QoQ and 2.12% YoY).
- PAR 31–90 days improved to 1.84% (from 2.40% QoQ and 2.45% YoY).
- Share of borrowers with exposure to ≤3 lenders rose to 91.2% (from 83.1% YoY), indicating tighter adherence to lending caps.
- Lenders remain cautious, supported by measures limiting borrower-level exposure and refined underwriting practices.
MFI sector shows resilience and maturity, with larger ticket sizes and focus on experienced borrowers, balancing growth with sustainability.
2.2 RBI implemented new norms allowing customers to nominate up to four persons for bank deposit accounts, safe deposit lockers, and articles in safe custody effective Nov 1 2025
- Nomination can specify percentage shares for each nominee.
- Banks must acknowledge nominations within three working days.
- The reforms aim to simplify access to funds and valuables after an account holder’s death, enhance transparency, and improve claim settlements.
- Standardized nomination procedures will be enforced across banks for uniformity and customer convenience
# 3 SEBI
3.1 SEBI in its draft circular released on Friday has provided detailed clarifications and operational modalities regarding the pro-rata rights of investors in Alternative Investment Funds (AIFs), following recent amendments to the AIF Regulations. Key points:
- Pro-rata rights must be maintained for every investor in an AIF scheme, in terms of investment commitment and proceeds distribution, except where SEBI specifies exemptions.
- The investors of a scheme of an AIF shall have rights in distribution of proceeds of an investment pro-rata to their contribution to such investment; or pro-rata to their contribution to such investment on a time weighted pro-rata basis, as clearly disclosed upfront to investors in the PPM of the scheme.
- Commitment for drawdown can mean total commitment or undrawn commitment, as clarified, and must be explicitly disclosed in the fund’s PPM and remain fixed throughout the scheme’s tenure.
- Existing AIF schemes can continue their adopted drawdown methodology until the end of their tenure but must align with the specified pro-rata methodologies for future investments or post-circular drawdowns, without being treated as a material change.
- Returns shared as carried interest (between investor and manager/sponsor) are excluded from pro-rata distribution obligations.
- All investor commitments (resident or non-resident) must be recorded in INR in contribution agreements, forming the basis for pro-rata calculations.
Impact
- Clear, uniform procedures for calculating pro-rata rights and drawdown methodologies remove ambiguity, allowing managers to align fund practices, disclosures, and investor communications.
- Clear guideline coming out for treatment of excused units. There is only one way the excused units can be implemented now easily – undrawn commitment. If drawdown is on commitment and when there is excused investment, that portion cannot be made good in the next drawdown. If we adopt undrawn commitment methodology, it will be adjusted in all future drawdowns which will make it operationally feasible option
- Time-weighted methodology is now specifically included as allowed methodology for allocation of distribution.
- Inclusion of employees, directors of IM to the list of entities eligible for sub ordinaries rights is a positive step.
The methodology proposed is aimed at preventing any investor from holding an excessive stake in an investee company beyond prescribed concentration limits. These provisions support robust governance, streamline AIF industry practices, and enhance investor confidence through standardised rights and transparent oversight.
3.2 SEBI has overhauled the share allocation framework for anchor investors in initial public offerings (IPOs) to encourage wider participation from domestic institutional investors such as mutual funds, insurance companies, and pension funds. Key changes:
- The overall anchor investor quota has been raised to 40% (from 33%), comprising 33% for mutual funds and 7% for insurers and pension funds. Any unsubscribed portion from insurers and pension funds will be reallocated to mutual funds.
- The number of permitted anchor investors for IPOs with anchor allocation exceeding ₹250 crore has been raised from 10 to 15 per ₹250 crore, ensuring broader participation.
- Revised allotment norms:
- For allocations up to ₹250 crore, a minimum of 5 and a maximum of 15 anchor investors will be allowed.
- For every additional ₹250 crore (or part thereof), another 15 investors may be included, with a minimum allotment of ₹5 crore per investor.
- The earlier discretionary allotment categories—Category I (up to ₹10 crore) and Category II (above ₹10 crore up to ₹250 crore)—have been merged into a single category for allocations up to ₹250 crore.
SEBI is also working on additional set of reforms in IPO process (a) to streamline the process for pledging shares of pre-IPO companies and rationalising disclosure requirements in offer documents, (b) to simplify the summary section of IPO offer documents and make them available separately to investors for feedback
The proposed move is expected to broaden institutional participation, enhance long-term stability in IPO subscriptions, and strengthen domestic capital market depth. IPO market is already buoyant and further simplification and streamlining would make it more robust and participative.
3.3 NSE to start a 15-minute pre-open session (9:00–9:15 am) for index and stock futures, mirroring equities – to Improve price discovery and reduce opening volatility.
- Mechanism:
- Orders can be placed, modified, or cancelled, no trading during this phase.
- System sets a single equilibrium price where demand and supply match best.
- Random close between the 7th–8th minute; equity and derivative sessions run separately.
- Excludes options, far-month and spread contracts, and futures of stocks with corporate actions.
- Price Discovery:
- Based on maximum order match; ties resolved by least imbalance, then proximity to previous close.
- If no match, first trade in normal hours sets opening price.
- Unmatched Orders:
- Limit orders carry over; market orders convert to limit at the discovered (or previous close) price.
This reform aligns futures trading with equities, fostering smoother openings, better price discovery, and reduced volatility at market start.
3.4 The Insolvency and Bankruptcy Board of India (IBBI) has proposed mandatory disclosure of beneficial ownership by all bidders (prospective resolution applicants) for bankrupt firms.
- This will help prevent misuse of the ‘clean slate’ principle under Section 32A of the IBC, which grants immunity to the resolved entity for past offences, ensuring disqualified promoters or related parties don’t re-enter through backdoor routes.
- Bidders must submit a beneficial ownership statement detailing all natural persons who ultimately own or control the applicant, including the shareholding structure and jurisdiction of each intermediate entity.
- The proposed format is modelled on RBI’s KYC framework, defining beneficial ownership as direct or indirect control exceeding 10% stake.
- Listed entities may be exempted from detailed ownership disclosures if adequate information is already available through SEBI, Companies Act, or overseas regulatory filings.
This move strengthens transparency in the insolvency process, safeguarding the integrity of the ‘clean slate’ principle and deterring covert re-entry by disqualified promoters.
# 4 Economy
4.1 As per S&P Global release last week,
- India’s composite PMI eased to 60.4 in October 2025 — above the flash estimate but below September’s 61.0 — marking a five-month low as growth momentum softened despite continued expansion in both manufacturing and services.
- Manufacturing PMI rose to 59.2 in October from 57.7 in September, signalling strong expansion.
- Lower GST rates spurred domestic demand, output, and purchasing activity.
- Sharp rise in domestic orders, while export growth slowed to a 10-month low.
- Firms expanded inventories and raw material purchases at the fastest pace since May 2023, aided by softer cost inflation.
- Services PMI fell to five-month low of 58.9 from 60.9 in September and 62.9 in August, though it remained well above the 50 mark that signals expansion
- New orders rose solidly but at a slower rate, and input cost inflation eased to its weakest since August 2024.
- Output prices remained above trend, though the pace of increase moderated, driven by steady manufacturing and slightly softer service prices.
GST cuts have clearly invigorated domestic manufacturing momentum, cushioning India’s growth against global trade softness. Despite a temporary slowdown, India’s services sector remains resilient, underpinned by strong domestic demand and business optimism.
4.2 As per study by 2025 G20 Committee of Experts on Global inequality released last week,
- The wealth share of India’s richest 1% rose 62% between 2000 and 2023, reflecting a sharp rise in inequality.
- As per World Inequality Lab, the top 1% in India holds 40.1% of total wealth, compared to 30.2% in China.
- Globally, the richest 1% increased their wealth share in over half of all countries, representing 74% of the world’s population.
- Over the past 40 years, the bottom 50% gained just $358, whereas the top 1% gained $191,000 (in constant 2024 dollars).
The report warns that high inequality raises the risk of democratic decline, making such nations seven times more vulnerable. The findings underscore that rising inequality is a policy-driven challenge, demanding decisive and coordinated global action to restore economic balance and social stability.
# 5 PE/VC
5.1 As per Inc42 report released last week
- India’s startup ecosystem saw $5.7 billion across 470 deals in H1 2025
- In comparison the deals were much higher in earlier years:
- 2022 – 1517 deals for $ 25 bn
- 2023 – 897 deals for $ 10 bn.
- 2024 – 993 deals for $ 12 bn.
- The deals recorded in H125 thus recorded a modest 8% uptick vs H12024.A modest 8% uptick vs H1 2024.
- But dig deeper, the number of deals stayed flat, and large deals (> $100 m) remain scarce. In short, the volume is stable, the value curve is resetting.
Founders who build for the long run will benefit when the wave returns.
5.2 As per Global Data, leading data and analytics company
- India’s venture capital (VC) funding landscape recorded year-on-year (YoY) expansion in the first three quarters (Q1-Q3) of 2025, registering double-digit increases in both deal volume and deal value.
- The total number of VC deals announced in India increased by 12% during Q1-Q3 2025 compared to Q1-Q3 2024, while the corresponding total funding increased by 14%,