Finnovate Weekly Capsule (Feb 02–Feb 06, 2026)

Welcome to this week’s edition of Finnovate’s Weekly Capsule. Here’s a crisp roundup of the most important budget, policy, market, and corporate developments from Feb 02–Feb 06, 2026, along with their impact analysis to help you interpret what lies ahead.

1. Union Budget 2026–27 keeps income tax rates unchanged

Impact Analysis

• Status quo was expected after generous tax cuts that made income up to ₹12.75 lakh tax-free under NTR.
• Implementation of the new Income Tax Act from April 2026 addresses multiple structural anomalies.

2. Budget hikes STT on F&O; buyback taxation rationalised

Impact Analysis

• STT raised 150% for futures and 50% for options, likely impacting trading volumes and arbitrage strategies.
• Buybacks to be treated as capital gains allow cost write-offs, but promoters face higher tax incidence.

3. Fiscal deficit projected at 4.3% and debt/GDP at 55.6% for FY27

Impact Analysis

• FY27 deficit is 10 bps lower than FY26, aided by spending discipline.
• Debt/GDP is projected to fall to 50% by 2030, improving India’s long-term fiscal credibility.

4. RBI holds repo rate at 5.25% in February policy

Impact Analysis

• Policy stance retained at “Neutral” with one dissenting vote seeking an accommodative shift.
• SDF rate remains at 5.00%, while MSF and bank rate stay at 5.25%.

5. RBI revises FY26 GDP growth to 7.4% and inflation to 2.1%

Impact Analysis

• GDP estimate now aligns with MOSPI projections, reflecting stronger momentum.
• Higher inflation assumption factors in core inflation from gold and silver prices.

6. Indo–US trade deal signed on Budget Day

Impact Analysis

• Deal aims to take bilateral trade to $500 billion, with aviation imports forming a large component.
• Detailed contours awaited, which will determine sector-specific winners and losers.

7. Uncertainty remains on India’s Russian crude purchases

Impact Analysis

• US claims of India halting Russian oil purchases remain unconfirmed by Indian authorities.
• Energy security considerations suggest India may continue diversified sourcing.

8. Two IPOs announced for the coming week

Impact Analysis

• Fractal Analytics (₹2,834 crore) and Aye Finance (₹1,010 crore) to open on Feb 09.
• Both issues combine fresh issue and OFS, testing appetite for analytics and NBFC stories.

9. Gold and silver remain highly volatile in global markets

Impact Analysis

• Gold recovered during the week, while silver corrected nearly 20% in a single session.
• ETF premiums in India are normalising after earlier distortions.

10. FPIs sell $3.95 billion of equities in January 2026

Impact Analysis

• Selling concentrated in banking, FMCG, autos, and consumer durables.
• Metals & mining and capital goods saw net buying, reflecting selective risk appetite.

11. Government set to exit IDBI Bank by March 2026

Impact Analysis

• Centre to sell 30.48% stake worth ~₹33,000 crore; LIC to sell an equivalent portion.
• Kotak Bank, Emirates NBD, and Fairfax are among key bidders.

12. PFC acquires 52.63% in REC as boards approve merger

Impact Analysis

• Merger aims to create a large-scale power financing entity.
• Despite consolidation, PFC will remain a government-owned entity.

13. Morgan Stanley sets bull-case Sensex target of 1,07,000 by end-2026

Impact Analysis

• Base case target of 95,000 still implies meaningful upside.
• Trade deal, rupee stability, and easing FPI outflows could drive re-rating.

14. Jefferies sees India benefiting from US tariff cuts

Impact Analysis

• Tariffs expected to fall from 50% to 18%, aiding labour-intensive exports.
• Autos, chemicals, and solar sectors likely to gain, supporting rupee strength.

15. IndiGo loses 4% market share amid December disruptions

Impact Analysis

• Market share fell to 59.6%, adding to November’s losses.
• Overall passenger traffic also declined, limiting gains for rivals.

16. SEBI proposes easing “Fit and Proper” norms for intermediaries

Impact Analysis

• Automatic disqualification for pending criminal complaints to be removed.
• Aims to balance fairness with regulatory oversight.

17. BPCL announces ₹25,000 crore investment in city gas distribution

Impact Analysis

• Investment spread over five years across 26 geographies.
• Singapore trading desk to scale global fuel operations.

18. Interbank call money rate falls to 42-month low of 4.40%

Impact Analysis

• Driven by RBI’s aggressive liquidity infusion via OMOs and FX swaps.
• Repo–call rate gap widened to 85 bps, highest in seven months.

19. PhysicsWallah posts strong Q3FY26 performance

Impact Analysis

• Revenue up 34% and net profit up 33%, with margins at 9.43%.
• Paid users rose 21% YoY to 43.7 lakh, driving operating leverage.

20. M&M to invest ₹15,000 crore in Nagpur manufacturing facility

Impact Analysis

• Facility operational by 2028, with capacity for 6 lakh units annually.
• Focus spans EVs, hybrids, IC engines, and export markets.

21. FMCG majors pay premium for Instagram-first D2C brands

Impact Analysis

• Tata Consumer, Marico, HUL and others acquiring digital-native brands.
• CRISIL notes nearly two-thirds of FMCG acquisitions are now D2C-led.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Please consult a registered advisor before making investment decisions.