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  • Best Multibagger PSU Stocks in India for 2026

    Best Multibagger PSU Stocks in India for 2026

    Historically, PSU stocks, or shares of government-owned companies, were largely overlooked by investors due to slow growth, political interference, and modest returns. However, these stocks have made remarkable comebacks in recent times. Several multibagger PSU stocks even delivered returns exceeding 200%, restoring the confidence of long-term investors.

    In this article, we will highlight 10 such PSU stocks that have generated impressive profits and are expected to continue performing well in the coming years.

    What Makes a PSU Stock a Multibagger ?

    A PSU stock qualifies as a multibagger when its robust financial fundamentals, consistent profitability, and strategic market opportunities result in its stock price appreciating several times over the initial investment. Such growth is typically influenced by factors like strong earnings growth, government support, sectoral tailwinds, and operational efficiency. Lets look at these factors in detail.

    • Government reforms and policies : The government is now providing professional management to private-like PSUs. Disinvestment, delisting and better governance are increasing the growth and profitability of companies.
    • Sector support : There is huge government spending in sectors like defense, railways, energy and infrastructure. Stocks like HAL, BEL, IRFC are benefiting from this.
    • Strong balance sheet and high dividend : Most PSU companies are debt-free and give large dividends as returns – like Coal India or NTPC. This gives investors a double benefit in returns.
    • Growth hidden in valuations : Many PSU stocks are available at cheap valuations due to being ignored for a long time. As soon as the company shows improvement, investors’ confidence returns and the share price rises rapidly.
    • Long-term perspective : It takes time to become a multibagger. Investors who have been patient have earned multifold returns even in PSUs.

    10 Multibagger PSU Stocks Based on Market Capitalisation

    CompanyCurrent Market Price (in ₹)Market Capitalisation (in ₹ crore)52-Week High (in ₹)52-Week Low (in ₹)
    Hindustan Aeronautics Ltd (HAL)4,3532,91,060 5,1663,046
    Bharat Electronics Ltd (BEL)4173,05,151 436240
    Coal India Ltd4232,60,714 442 349
    Indian Railway Finance Corp (IRFC)1171,52,914 156 108
    Power Finance Corporation (PFC)3651,20,456 444 330
    Mazagon Dock Shipbuilders2,36995,565 3,7781,918
    NHPC Ltd77.577,737 92.3 71
    BEML Ltd1,69114,090 2,437 1,173
    Engineers India Ltd (EIL)1779,940 255142
    Shipping Corporation of India2079,648 280 138
    (Data as of 22 January 2026)

    Read Also: Multibagger Penny Stocks

    Overview of the 10 Multibagger PSU Stocks in India 

    A brief overview of the Multibagger PSU Stocks in India is given below:

    1. Hindustan Aeronautics Ltd (HAL)

    Hindustan Aeronautics Ltd i.e. HAL is the name of India’s air power which has been the backbone of our fighter planes and helicopters for decades. This company not only manufactures modern fighter jets like Tejas, but also specializes in aircraft maintenance, upgrades and support systems. HAL’s network is spread across the country and it is also continuously promoting defense exports. Under ‘Make in India’, HAL has emphasized on indigenous aircrafts and technologies, which has strengthened both India’s strategic power and self-reliance.

    Know the Returns: 

    1Y Return (%)3Y Return (%)5Y Return (%)
    7.08245.47800.37
    (Data as of 22 January 2026)

    2.  Bharat Electronics Ltd (BEL)

    Bharat Electronics Ltd i.e. BEL is a strong name in the country’s defense technology. This company manufactures radar systems, missile guidance, and communication devices for the army. The special thing is that BEL is no longer limited to just the defense sector – it is also working on civil projects such as smart city solutions, medical devices and election systems (such as EVM). The company is constantly researching new technologies and strengthening ‘Make in India’. Today BEL has become an important link in the direction of India’s technological self-reliance.

    Know the Returns: 

    1Y Return (%)3Y Return (%)5Y Return (%)
    49.75308.21838.88
    (Data as of 22 January 2026)

    3. Coal India

    Coal India is not just a company, it is the backbone of the country’s energy needs. This is the same name that has been continuously supplying coal to thermal power plants and large industries in India for years. It has many units spread across the country which handle work from mining to transportation. Today, when the country talks about energy security, Coal India is at the forefront. The company has improved mining methods in the last few years, has also taken care of the environment and has made the work better by adopting technology.

    Know the Returns: 

    1Y Return (%)3Y Return (%)5Y Return (%)
    10.8885.12207.97
    (Data as of 22 January 2026)

    4. Indian Railway Finance Corporation (IRFC)

    IRFC is the financial backbone of Indian Railways. This company works to raise and manage funds for railway projects. Whether it is the purchase of new trains, expansion of infrastructure or financing of mega projects IRFC is engaged in strengthening the railways silently. It comes under the Ministry of Railways and is a fully government-owned company. In 2025, when the modernization of railways is gaining momentum, the role of IRFC has become even more important as it is making this growth possible economically.

    Know the Returns: 

    1Y Return (%)3Y Return (%)5Y Return (%)
    -17.51251.95372.09
    (Data as of 22 January 2026)

    5. Power Finance Corporation (PFC)

    Power Finance Corporation is an important financing company for India’s power sector. This company provides long-term loans and financial assistance to power projects, increasing the capacity of power distribution and generation across the country. PFC is playing an active role in turning the government’s ’24×7 electricity’ mission into ground reality. The company’s network is spread across the country and it has access to large power developers. By 2025, PFC is also increasing investment in areas like green energy, renewable sources and grid upgrades.

    Know the Returns: 

    1Y Return (%)3Y Return (%)5Y Return (%)
    -14.34203.07285.65
    (Data as of 22 January 2026)

    6. Mazagon Dock Shipbuilders

    Mazagon Dock Shipbuilders is India’s leading government shipbuilding company, which builds warships and submarines especially for the Navy. Many state-of-the-art ships are built in this yard located in Mumbai, which increases the strength of the Indian Navy. Mazagon Dock is not limited to just construction, but is also fully capable of design, testing and maintenance. In recent years, the company has focused on indigenous technology and self-reliant defense projects. By 2025, Mazagon Dock has established itself as a strategic and futuristic PSU.

    Know the Returns: 

    1Y Return (%)3Y Return (%)5Y Return (%)
    1.02515.922,146.46
    (Data as of 22 January 2026)

    7.  NHPC Ltd

    NHPC i.e. National Hydroelectric Power Corporation is India’s largest hydro power company. This company is running large hydroelectric projects in the hilly and river-dominated areas of the country. NHPC’s work is not limited to power generation only, but it also focuses on sustainable use of water sources and environmental balance. In 2025, NHPC has emerged as a leading PSU in clean energy and environment-sensitive power generation, a strong partner towards making India energy self-reliant.

    Know the Returns: 

    1Y Return (%)3Y Return (%)5Y Return (%)
    -1.8180.70212.94
    (Data as of 22 January 2026)

    8. BEML Ltd

    BEML i.e. Bharat Earth Movers Limited, is a multi-sector PSU that manufactures heavy machinery for defense, mining and railway sectors. From tanks to railway coaches and metros BEML’s products are being used in every corner of the country. The company is headquartered in Bengaluru and focuses on indigenous manufacturing and technological self-reliance. In 2025, BEML has proven itself as a fast-growing PSU with new contracts and export orders in the defense and infrastructure sectors.

    Know the Returns: 

    1Y Return (%)3Y Return (%)5Y Return (%)
    -8.63121.46249.56
    (Data as of 22 January 2026)

    9. Engineers India Ltd (EIL)

    Engineers India Ltd is a government company that provides engineering, design and consultancy services for oil-gas and infrastructure projects. Be it a refinery or a petrochemical plant, a pipeline project or a city gas network — EIL’s expertise is visible everywhere. The company is taking up projects not only domestically but also internationally. By 2025, EIL has also started working on green energy and climate-sensitive projects, further strengthening its identity as a modern, responsible and technology-enabled PSU.

    Know the Returns: 

    1Y Return (%)3Y Return (%)5Y Return (%)
    0.0998.71133.66
    (Data as of 22 January 2026)

    10. Shipping Corporation of India (SCI)

    Shipping Corporation of India i.e. SCI is India’s leading merchant navy company providing marine freight, tanker service and offshore support services. Its services are spread across the country as well as internationally. SCI is playing an important role in increasing India’s maritime trade capacity. In recent years, the company has upgraded its fleet and adopted digital technology. By 2025, SCI is taking itself in a new direction by moving from public to private transition and better management.

    Know the Returns: 

    1Y Return (%)3Y Return (%)5Y Return (%)
    4.3946.76142.72
    (Data as of 22 January 2026)

    Key Performance Indicators (KPIs)

    The key performance metrics of Multibagger PSU Stocks are mentioned below:

    CompanyOperating Margin (%)Net Profit Margin (%)ROE (%)ROCE (%)Debt to Equity
    Hindustan Aeronautics Ltd (HAL)34.9526.8623.9117.410.00
    Bharat Electronics Ltd (BEL)29.9022.2426.6433.720.00
    Coal India Ltd33.0524.3035.6724.240.09
    Indian Railway Finance Corp (IRFC)99.4223.9412.3449.987.83
    Power Finance Corporation (PFC)96.9928.6519.5265.868.25
    Mazagon Dock Shipbuilders26.8219.9230.3934.50.00
    NHPC Ltd54.6832.847.576.210.99
    BEML Ltd11.387.2710.1311.430.08
    Engineers India Ltd (EIL)20.4915.2821.7223.440.00
    Shipping Corporation of India17.9714.5010.1410.000.23
    (Data as of March, 2025)

    Read Also: List Of Best PSU Stocks in India

    Factors to be Considered Before Investing in PSU stocks

    The opportunity to invest in Multibagger PSU stocks is definitely big, but every opportunity also comes with some risk and requires prudence. Paying attention to the points given below is the mark of a smart investor:

    • Understand the role of the company and the situation of the sector : Every PSU works in a different sector – like energy, defense, infrastructure or finance. Before investing, it is important to understand what is the policy support of that sector and what is the growth potential in it in the coming years.
    • Do not take a decision just by looking at past returns : PSU stocks have performed well in recent years, but investing just by looking at old charts can be wrong. It is important that you see whether the company has a solid basis to move forward or not – like new order book, project pipeline and policy support.
    • Government involvement and disinvestment policy : PSU companies have a government stake, which can sometimes lead to political decisions rather than commercial ones. While the disinvestment policy has proved beneficial for many companies — it is important to be clear about its timing and impact.
    • Check valuations properly : PSU stocks may look cheap, but their valuations may also be down due to poor business outlook or fundamentals. Invest keeping in mind the PE ratio, book value and future earnings.
    • Policy and regulatory risks : Public companies are often affected quickly by policy changes — such as tax policies, licensing or environmental regulations. Therefore, it is important that you also evaluate the company’s business model from the perspective of these risks.
    • Understand the dividend and return structure : PSU stocks often pay high dividends, which is good for long-term income. But sometimes companies only pay dividend-based income and growth is low. Understand this balance of returns before investing.
    • Have a long-term perspective : Multibagger PSU stocks are not created overnight. They take time — sometimes up to 2–4 years. So if you are expecting quick returns, this strategy is not for you. Only patience and understanding can yield true profits.

    Read Also: Top 5 PSU Penny Stocks List in India

    Conclusion

    Investing in PSU stocks can be rewarding if approached with thorough research and a disciplined, long-term strategy. Public sector companies are becoming increasingly attractive due to strong order books, improved corporate governance, and government policy support. However, each stock should be evaluated carefully based on its sector performance, valuation metrics, and growth potential. For investors with a long-term perspective, PSU stocks have the potential to generate substantial returns. It is advised to consult a financial advisor before investing.

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    Frequently Asked Questions (FAQs)

    1. What are multibagger PSU stocks?

      These are the stocks of government companies that have the potential to give multifold returns over time.

    2. Are PSU stocks safe for beginners?

      Yes, but it is important to understand the company’s position and sector well before investing.

    3. How long should I hold a multibagger PSU stock?

      It is better to have a 3 to 5 year perspective in such stocks.

    4. Do PSU stocks give good dividends?

      Yes, most PSU companies pay regular and high dividends.

    5. What risks are involved in PSU stock investment?

      Risks may include policy changes, political interference and disinvestment.

  • Vikran Engineering Ltd. IPO Day 1: GMP & Subscription Status

    Vikran Engineering Ltd. IPO Day 1: GMP & Subscription Status

    Vikran Engineering Ltd.’s IPO is a book-built issue worth ₹772 crore, comprising a fresh issue of ₹721 crore and an offer-for-sale of ₹51 crore. The price band is set at ₹92–₹97 per share. Bidding opens on August 26, 2025, and closes on August 29, 2025. The shares are expected to be listed on BSE & NSE on September 3, 2025.

    Vikran Engineering IPO – Day 1 Subscription Status

    Vikran Engineering IPO was subscribed 2.51× on Day 1. The public issue received 2.44× subscription in the Retail Individual Investors (RII) category, 0.43× in Qualified Institutional Buyers, and 5.43× in the Non-Institutional Investors (NII) category as of Day 1, i.e., August 26, 2025.

    Investors CategorySubscription (×)
    Qualified Institutional Buyers (QIB)0.43
    Non-Institutional Investors (NII)5.43
    bNII (above ₹10 lakh)5.76
    sNII (less than ₹10 lakh)4.78
    Retail Individual Investors (RII)2.44
    Total Subscriptions2.51

    Total Applications: 3,91,425
    Total Bid Amount: ₹1,356 Cr.

    Objective of the Vikran Engineering IPO

    Vikran Engineering plans to channel the IPO proceeds towards strengthening its working capital, giving the company the financial flexibility to power daily operations and future growth, while also setting aside funds for general corporate purposes.

    Objects of the IssueExpected Amount (₹ in crores)
    Funding working capital requirements of the Company541.00
    General corporate purposes–

    Vikran  Engineering IPO GMP – Day 1 Update

    DateGMP Est. Listing Price Gain 
    August 26, 2025 (Day 1)₹12₹10912.37%

    Disclaimer: The above GMP (Grey Market Premium) is just unofficial market information, which is not officially confirmed. These figures are shared for informational purposes only and investment decisions based on these should be based on the investor’s own research and discretion. We do not conduct, recommend or support any kind of transaction in the grey market.

    Vikran Engineering Ltd. IPO – Key Details

    ParticularsDetails
    IPO Opening DateAugust 26, 2025
    IPO Closing DateAugust 29, 2025
    Price Band₹92–₹97 per share
    Total Issue Size₹772 crore (Fresh: ₹721 Cr; OFS: ₹51 Cr)
    Lot Size148 shares
    Listing PlatformBSE & NSE
    RegistrarBigshare Services Pvt. Ltd.

    Important Dates for Vikran  Engineering IPO Allotment

    EventDate
    Tentative AllotmentSeptember 1, 2025
    Initiation of RefundsSeptember 2, 2025
    Credit of Shares to DematSeptember 2, 2025
    Listing Date on BSE & NSESeptember 3, 2025

    Vikran Engineering Ltd. Overview

    Vikran Engineering Ltd., incorporated in 2008, is a growing EPC company with expertise in power, water, railways, and solar projects. It has completed 45 projects across 14 states and is executing 44 ongoing projects worth over ₹51,202 million. Key clients include NTPC, Power Grid Corporation, and various state utilities. With a diversified order book of ₹24,424 million and 761 employees, the company ensures quality and timely delivery. Financially, it reported 17% revenue growth and 4% PAT rise in FY25.

    Easy Steps to Apply for Vikran  Engineering IPO via Pocketful

    Step 1: Install the Pocketful app from Play Store or App Store.
    Step 2: Complete your KYC process.
    Step 3: Go to the IPO section on the app.
    Step 4: Find “Vikran  Engineering” in the IPO list.
    Step 5: Tap Apply and enter your bid details.

    Frequently Asked Questions (FAQs)

    1. What are the opening and closing dates of Vikran Engineering IPO?

      Opens August 26, 2025, and closes August 29, 2025.

    2. What is the price band for the IPO?

      Price range is ₹92–₹97 per share.

    3. What is the total issue size of the IPO?

      Total issue size is ₹772 crore (Fresh: ₹721 Cr; OFS: ₹51 Cr).

    4. When will the shares be listed?

      Listing expected on September 3, 2025, on BSE & NSE.

    5. What are the IPO objectives?

      Proceeds will fund working capital and general corporate needs.

  • Anondita Medicare Ltd. IPO Allotment Status: Check Latest GMP, Steps to Verify Status

    Anondita Medicare Ltd. IPO Allotment Status: Check Latest GMP, Steps to Verify Status

    Anondita Medicare Ltd. is launching its IPO as a fresh issue of approximately ₹69.50 crore, offering up to 47.93 lakh equity shares at a price band of ₹137–₹145 per share. The IPO opened on August 22, 2025, and will close on August 26, 2025. The shares are slated to list on the NSE SME platform on September 1, 2025.

    Anondita Medicare IPO – Day 3 Subscription Status

    On Day 3, the Anondita Medicare IPO was subscribed 300.89× overall. Among investor categories, Qualified Institutional Buyers (QIBs) saw a subscription of 153.03×, Non-Institutional Investors (NII) were subscribed 531.82×, and Retail Individual Investors (RII) recorded 286.20×, reflecting strong demand from both NII and RII segments.

    Investors CategorySubscription (×)
    Qualified Institutional Buyers (QIB)153.03
    Non-Institutional Investors (NII)531.82
    bNII (above ₹10 lakh)641.02
    sNII (less than ₹10 lakh)313.43
    Retail Individual Investors (RII)286.20
    Total Subscriptions300.89

    Total Applications: 2,88,034
    Total Bid Amount: ₹13,843 Cr.

    How to Check Anondita Medicare IPO Allotment Status

    Anondita Medicare IPO allotment can be easily checked online in two ways: from the Registrar’s website and from the NSE website. This IPO will be listed on NSE SME.

    Method 1: Registrar’s website (Maashitla Securities Pvt.Ltd.)

    The most reliable way is to check the allotment from Maashitla Securities Pvt.Ltd.’s website.

    How to do:

    • Visit Maashitla Securities’s official website
    • Select “Anondita Medicare Ltd.” from the IPO list
    • Enter your details PAN number, Application number, or DP/Client ID
    • Click on Submit
    • You will see the allotment status on the screen.

    Method 2: Check from NSE’s website

    If there is more traffic on the registrar’s website, allotment status can also be checked from the NSE website.

    How to do:

    • Visit NSE’s official website
    • Select ‘Equity’ segment
    • Select “Anondita Medicare Ltd.” from the IPO list
    • Enter PAN number and Application number
    • Click on Search

    Objective of the Anondita Medicare IPO

    The primary objectives include funding capital expenditure for new equipment and machinery, meeting working capital requirements to ensure smooth business operations, and allocating funds for potential acquisitions and other general corporate purposes.

    Objects of the IssueExpected Amount (in Millions)
    Funding capital expenditure requirements for the purchase of equipment/machineries60
    Funding the Working Capital requirement350
    Unidentified Acquisition and General Corporate Purposes–

    Anondita Medicare IPO GMP – Day 3 Update

    On August 26, 2025, the IPO recorded a Grey Market Premium (GMP) of ₹80, leading to an estimated listing price of ₹225. This indicators a strong listing gain of 55.17%, reflecting high investor enthusiasm.

    DateGMPEstimated Listing Price Gain
    August 26, 2025 (Day 3)₹80₹22555.17%

    Disclaimer: The above GMP (Grey Market Premium) is just unofficial market information, which is not officially confirmed. These figures are shared for informational purposes only and investment decisions based on these should be based on the investor’s own research and discretion. We do not conduct, recommend or support any kind of transaction in the grey market.

    Important Dates for Anondita Medicare IPO Allotment

    EventDate
    Tentative Allotment August 28, 2025
    Initiation of RefundsAugust 29, 2025
    Credit of Shares to DematAugust 29, 2025
    Listing Date on NSE SMESeptember 1, 2025

    Anondita Medicare IPO – Key Details

    ParticularsDetails
    IPO Opening DateAugust 22, 2025
    IPO Closing DateAugust 26, 2025
    Price Band₹137–₹145 per share
    Total Issue Size₹69.50 crore (Fresh Issue)
    Lot Size1,000 shares
    Listing PlatformNSE SME 

    Anondita Medicare Ltd. Overview

    Anondita Medicare Ltd., incorporated in March 2024, is a Noida-based manufacturer of flavored male condoms under the brand “COBRA”, with a production capacity of 562 million pieces annually. Serving domestic and export markets (Southeast Asia, Africa, Middle East), the company demonstrated robust growth with revenue rising from ₹46.56 crore in FY24 to ₹77.13 crore in FY25, and PAT surging from ₹3.84 crore to ₹16.42 crore.

    Frequently Asked Questions (FAQs)

    1. What are the opening and closing dates of the Anondita Medicare IPO?

      The IPO opened on August 22, 2025, and closes on August 26, 2025.

    2. What is the price band of the IPO?

      The price range is ₹137–₹145 per share.

    3. What is the total size of the IPO?

      The issue comprises a fresh issue of ₹69.50 crore.

    4. When will Anondita Medicare shares be listed?

      Listing is expected on September 1, 2025, on NSE SME.

    5. What is the Day 3 subscription status?

      The IPO has seen 300.89× overall subscription.

  • Shivashrit Foods Ltd. Allotment Status: Check Latest GMP, Steps to Verify Status

    Shivashrit Foods Ltd. Allotment Status: Check Latest GMP, Steps to Verify Status

    Shivashrit Foods Ltd. has launched its SME IPO on August 22, 2025, with an issue size of ₹70.03 crore, comprising a fresh issue of ₹61.29 crore and an offer-for-sale of ₹8.75 crore. The IPO closed for subscription on August 26, 2025, and the shares are scheduled to list on the NSE SME (Emerge) platform on September 1, 2025.

    Shivashrit Foods IPO – Day 3 Subscription Status

    On Day 3 of the Shivashrit Foods IPO, the issue received a total subscription of 2.89×. Among investor categories, Qualified Institutional Buyers (QIBs) were subscribed 1.59×, Non-Institutional Investors (NII) received 5.16×, and Retail Individual Investors (RII) recorded a subscription of 2.65×.

    Investor CategorySubscription (×)
    Qualified Institutional Buyers (QIB)1.59
    Non-Institutional Investors (NII)5.16
    bNII (above ₹10 lakh)6.38
    sNII (less than ₹10 lakh)2.73
    Retail Individual Investors (RII)2.65
    Total Subscriptions2.89

    Total Applications: 2,577
    Total Bid Amount: ₹134 Cr.

    How to Check Shivashrit Foods IPO Allotment Status

    Shivashrit Foods IPO allotment can be easily checked online in two ways: from the Registrar’s website and from the NSE website. This IPO will be listed on NSE SME.

    Method 1: Registrar’s website (Maashitla Securities Pvt.Ltd.)

    The most reliable way is to check the allotment from Maashitla Securities Pvt.Ltd.’s website.

    How to do:

    • Visit Maashitla Securities’s official website
    • Select “Shivashrit Foods Ltd.” from the IPO list
    • Enter your details PAN number, Application number, or DP/Client ID
    • Click on Submit
    • You will see the allotment status on the screen.

    Method 2: Check from NSE’s website

    If there is more traffic on the registrar’s website, allotment status can also be checked from the NSE website.

    How to do:

    • Visit NSE’s official website
    • Select ‘Equity’ segment
    • Select “Shivashrit Foods Ltd.” from the IPO list
    • Enter PAN number and Application number
    • Click on Search

    Objective of the Shivashrit Foods IPO

    The funds raised will be used to finance expansion projects, strengthen working capital, and support general corporate needs, enabling the company to scale its operations efficiently.

    Objects of the IssueExpected Amount (in Millions)
    Capital Expenditure (“Expansion Project”)263
    Working Capital Requirement for Expansion Project190
    General Corporate Purpose–

    Shivashrit Foods IPO GMP – Day 3 Update

    At the end of its third day, the IPO had a Grey Market Premium (GMP) of ₹1, resulting in an estimated listing price of ₹143. This translated to a negligible listing gain of 0.70%.

    DateGMP (₹)Estimated Listing Price (₹)Gain (%)
    August 26, 2025 (Day 3)₹1₹1430.70%

    Disclaimer: The above GMP (Grey Market Premium) is just unofficial market information, which is not officially confirmed. These figures are shared for informational purposes only and investment decisions based on these should be based on the investor’s own research and discretion. We do not conduct, recommend or support any kind of transaction in the grey market.

    Shivashrit Foods Ltd. IPO – Key Details

    ParticularsDetails
    IPO Opening DateAugust 22, 2025
    IPO Closing DateAugust 26, 2025
    Price Band₹135–₹142 per share
    Total Issue Size₹70.03 crore (Fresh: ₹61.29 Cr; OFS: ₹8.75 Cr)
    Lot Size1,000 shares
    Listing PlatformNSE SME
    RegistrarMaashitla Securities Pvt. Ltd.

    Important Dates for Shivashrit Foods IPO Allotment

    EventDate
    Tentative Allotment August 28, 2025
    Refunds InitiationAugust 29, 2025
    Credit of Shares to DematAugust 29, 2025
    Listing Date on NSE SMESeptember 1, 2025

    Shivashrit Foods Ltd. Overview

    Incorporated in 2017 and headquartered in Aligarh, Uttar Pradesh, Shivashrit Foods Ltd. is engaged in the production, supply, and export of premium potato flakes used in ready-to-eat meals, snacks, and processed foods. Its processing facility holds multiple certifications including FSSAI, ISO 22000, HALAL, BRCGS, and USFDA, ensuring global standards of quality. The company markets its products both domestically and internationally, catering to rising demand in the food processing sector. 

    Financially, Shivashrit Foods has demonstrated strong growth momentum, with revenue increasing from ₹77.55 crore in FY2024 to ₹105.85 crore in FY2025, while PAT rose from ₹11.61 crore to ₹12.06 crore during the same period.

    Frequently Asked Questions (FAQs)

    1. When does the Shivashrit Foods IPO open and close?

      The IPO opens on August 22, 2025, and closes on August 26, 2025.

    2. What is the price band?

      Price band for the IPO is set at ₹135 to ₹142 per share.

    3. What is the issue size and structure?

      Total size is ₹70.03 crore, comprising a fresh issue of ₹61.29 crore and OFS of ₹8.75 crore.

    4. When will the listing happen?

      Shares of Shivashrit Foods will list on September 1, 2025, on NSE SME.

    5. What are the IPO objectives?

      Funds will be used for expansion capital expenditure, working capital needs, and general corporate purposes.

  • Classic Electrodes Allotment Status: Check Latest GMP, Steps to Verify Status

    Classic Electrodes Allotment Status: Check Latest GMP, Steps to Verify Status

    Classic Electrodes (India) Ltd.’s IPO is a fresh issue of ₹41.51 crore, with a price band of ₹82–₹87 per share. Bidding opens on August 22, 2025, and closes on August 26, 2025. The shares will be listed on NSE SME on September 1, 2025.

    Classic Electrodes IPO – Day 3 Subscription Status

    On Day 3 of the Classic Electrodes IPO, the issue received a total subscription of 179.97×. Among investor categories, Qualified Institutional Buyers (QIBs) were subscribed 84.88×, Non-Institutional Investors (NII) received 356.75×, and Retail Individual Investors (RII) recorded a subscription of 158.44×.

    Investors CategorySubscription (×)
    Qualified Institutional Buyers (QIB)84.88
    Non-Institutional Investors (NII)356.75
    bNII (above ₹10 lakh)421.54
    sNII (less than ₹10 lakh)227.62
    Retail Individual Investors (RII)158.44
    Total Subscriptions179.97

    Total Applications: 1,01,973
    Total Bid Amount: ₹4,927 Cr.

    How to Check Classic Electrodes IPO Allotment Status

    Classic Electrodes IPO allotment can be easily checked online in two ways: from the Registrar’s website and from the NSE website. This IPO will be listed on NSE SME.

    Method 1: Registrar’s website (MUFG Intime India Pvt. Ltd.)

    The most reliable way is to check allotment from MUFG Intime India Private Limited’s website.

    How to do:

    • Visit MUFG Intime’s official website
    • Select “Classic Electrodes” from the IPO list
    • Enter your details PAN number, Application number, or DP/Client ID
    • Click on Submit
    • You will see the allotment status on the screen.

    Method 2: Check from NSE’s website

    If there is more traffic on the registrar’s website, allotment status can also be checked on the NSE.

    How to do:

    • Visit NSE’s official website
    • Select ‘Equity’ segment
    • Select “Classic Electrodes” from the IPO list
    • Enter PAN number and Application number
    • Click on Search

    Objective of the Classic Electrodes IPO

    The primary objectives of the IPO are to fund capital expenditures, repay outstanding borrowings, meet working capital requirements, and support general corporate purposes.

    Objects of the IssueExpected Amount (in Millions)
    Funding capital expenditure of our company to purchase Plant and Machinery100
    Repayment of a portion of certain outstanding borrowing availed by the company100
    Funding the working capital requirements of the company166
    General Corporate Purposes–

    Classic Electrodes IPO GMP – Day 3 Update

    On August 26, 2025, the IPO showed a Grey Market Premium (GMP) of ₹17, translating to an estimated listing price of ₹104. This resulted in a healthy listing gain of 19.54% for investors, signaling strong market enthusiasm for the IPO.

    DateGMP Est. Listing Price Gain
    August 26, 2025 (Day 3)₹17₹10419.54%

    Disclaimer: The above GMP (Grey Market Premium) is just unofficial market information, which is not officially confirmed. These figures are shared for informational purposes only and investment decisions based on these should be based on the investor’s own research and discretion. We do not conduct, recommend or support any kind of transaction in the grey market.

    Classic Electrodes (India) Ltd. IPO – Key Details

    ParticularsDetails
    IPO Opening DateAugust 22, 2025
    IPO Closing DateAugust 26, 2025
    Price Band₹82–₹87 per share
    Total Issue Size₹41.51 crore (Fresh Issue)
    Lot Size1,600 shares
    Listing PlatformNSE SME
    RegistrarMUFG Intime India Pvt. Ltd.

    Important Dates for Classic Electrodes IPO Allotment

    EventDate
    Tentative AllotmentThu, Aug 28, 2025
    Initiation of RefundsThu, Aug 28, 2025
    Credit of Shares to DematFri, Aug 29, 2025
    Listing Date on NSE SMESeptember 1, 2025

    Classic Electrodes (India) Ltd. Overview

    Established in 1997 and headquartered in Kolkata, West Bengal, Classic Electrodes (India) Limited is a leading manufacturer of welding consumables, including electrodes and MIG wires, catering to both domestic and international markets. The company offers a wide range of products such as mild steel, stainless steel, cast iron, deep penetration electrodes, and MIG wires for varied industrial applications. With two manufacturing units located in Dhulagarh, West Bengal, and Jhajjar, Haryana, it ensures strong regional coverage and efficient logistics, while the earlier Bahadurgarh unit was closed in FY 2023–24 as part of restructuring.

    Frequently Asked Questions (FAQs)

    1. What are the opening and closing dates of Classic Electrodes IPO?

      The IPO opened on August 22, 2025, and closed on August 26, 2025.

    2. What is the price band for the IPO?

      The price band is set between ₹82 and ₹87 per share.

    3. What is the issue size of the IPO?

      The IPO size is ₹41.51 crore (fresh issue only).

    4. When will the shares be listed?

      Shares are expected to be listed on NSE SME on September 1, 2025.

    5. What is the GMP of Classic Electrodes IPO on Day 3?

      The GMP at the close of Classic Electrodes IPO on Day 3 was ₹17.


  • Rapido Case Study: Business Model, Marketing Strategy, Financial, and SWOT Analysis

    Rapido Case Study: Business Model, Marketing Strategy, Financial, and SWOT Analysis

    Rapido is a leading Indian two-wheeler ride-hailing service that launched in 2015 and is now active in over 100 cities. The platform offers services like bike-taxi, auto-rickshaw, parcel delivery and operates on an asset-light model. 

    In this Rapido case study, we will try to understand the Rapido Business Model, marketing strategy of Rapido, financial analysis of Rapido and SWOT analysis of Rapido in detail.

    Rapido: An Overview

    Rapido was launched in October 2015 when three youngsters Aravind Sanka, Pavan Guntupalli, and SR Rishikesh previously ran a logistics platform, the Karrier. While this option was stable, scaling was difficult. They realised that two-wheelers (motorcycles) account for nearly 75% of vehicles in India, and could make for a much faster, cheaper option. This insight led them to launch ‘Rapido’ a bike‑taxi platform.

    Market Context : At the time, India was dominated by big players like Ola and Uber, but these were focused on four-wheelers. The country had traffic jams, expensive travel, and insufficient public transport. Rapido has introduced an asset‑light, two-wheeler-based, last‑mile solution to provide affordable and faster travel, especially in Tier‑2, Tier‑3 cities.

    Rapido has achieved several key milestones:

    • Expansion across cities: Rolls out to 100+ cities by 2022
    • Unicorn status: Becomes a Unicorn with a $200 million Series E funding round in September 2024; valuation recorded at $1.1 billion
    • Financial progress: Revenues rise to ₹648 crore in FY24 (₹443 crore in FY23), and losses narrow to ₹370 crore (₹675 crore in FY23)

    Some of the key metrics of Rapido are shown in the table below:

    MetricData
    Revenue (FY24)₹648 crore (increased from ₹443 crore FY23)
    Losses (FY24)₹370 crore (decreased from ₹675 crore)
    Gross Order Value (GOV) FY24₹4,257 crore (from ₹2,419 crore FY23)
    Ride Orders (FY24)Around 44.50 crores rides (increased from 30.7 crores FY23)
    Cities of Operation100+ cities

    Rapido Business Model

    Rapido is a bike taxi aggregator that is rapidly transforming local transportation in India’s urban and semi-urban areas. Its model is based on a tech-enabled, asset-light, two-sided marketplace – where there are customers (riders) on one side and bike drivers (Captains) on the other. Rapido connects the two through a seamless mobile app.

    • Aggregator Platform – No vehicle, just technology : Rapido does not own any bike. It is a platform-based aggregator that provides services through other people’s bikes. Captains register on the app with their documents and bikes and then accept on-demand rides. The entire system is managed by the app and GPS tracking.
    • Asset-Light Model Low Cost, High Scale : Rapido’s business model is based on an asset-light structure, i.e. the company does not buy any bikes itself. This keeps its fixed cost very low and it can start its operations in new cities very quickly.
    • Hyperlocal Market Focus Small cities, big scope : Rapido’s strategy is not limited to metro cities only. It has also launched its service in small and medium cities, where there is a demand for local transport but there is a lack of organized solutions. With this hyperlocal penetration, Rapido has gained early-mover advantage in markets with less competition.

    Rapido Earns – How does revenue come about?

    Rapido makes money from multiple sources:

    • Per Ride Commission : Rapido takes a commission of around 15% to 20% on every ride. The rest of the money goes to the driver’s account.
    • Surge Pricing : When demand is high (peak hours, festivals), the price of the ride increases, which gives more revenue to the company.
    • Rapido Local & Delivery : Rapido has now added delivery services to its platform, such as sending parcels, groceries or office documents. This has added a new revenue stream.
    • Subscription Plans : Monthly subscription plans have also been introduced for frequent users in some metro cities, which gives discounts to the users and assured income to the company.
    • Brand Collaborations & Ads : Rapido also earns through in-app advertising and promotional campaigns in collaboration with other brands on its app.

    Read Also: Ola Electric Case Study: Business Model, Financials, and SWOT Analysis

    Marketing Strategy of Rapido

    1. Brand Positioning & Messaging

    Rapido has positioned itself as “India’s Bike-Taxi Disruptor” with a focus on affordability, faster service, and local connect. Their tagline “Bike Wali Taxi, Sabse Asaan” with simple messaging assures users that getting a ride is now easy and affordable.

    2. Digital & Social Media Marketing

    • Social Campaigns: Rapido ran campaigns like #GoRapido and #NoStressSawari that presented real-life problems of daily commute in a relatable way.
    • Influencer Marketing: Collaborated with regional content creators to increase reach to local audiences.
    • App Optimization: App store optimization, push notifications, and personalized deals were used to drive user engagement and retention.

    3. Celebrity Branding

    In 2023, Ranveer Singh was made the brand ambassador. Catchy ads like “Smart ho toh Rapido” were launched with him which especially appeal to the youth. In 2024-25, campaigns were made more relatable by adding local actors and influencers from small cities.

    4. On-ground Strategy

    • Focus on small cities : Rapido initially chose those cities where bike usage was already high. The youth and delivery agents there were made “Captains”.
    • Referral Bonus : People who had already joined were given a bonus for bringing their friends this increased both trust and network rapidly.
    • Local Branding : On-ground branding at places like railway stations, petrol pumps and local markets made the brand familiar in the eyes of the people.

    5. Go-To-Market Plan for Food Delivery

    • One App, Two Jobs : Rapido integrated ride as well as food delivery in the same app so that users do not have to open separate apps.
    • Low Commission Strategy : While Zomato/Swiggy charge a hefty commission, Rapido charged only half the amount from restaurants. This helped more vendors to join.
    • Tier-2/3 Cities Onboarding : In small cities, local dhabas and restaurants were onboarded as quickly as possible by offering zero commission or ₹25 fixed delivery charge.

    6. Multi-Modal Mobility & Partnerships

    Rapido did not limit itself to just one bike-taxi app. They collaborated with big entities like DMRC and ONDC to create pickup/drop zones at metro stations and also introduced features like metro ticket booking. 

    Financials Analysis of Rapido

    Financial Metrics

    Financial MetricsFY 2024Q2 FY25
    Revenue (₹ in crores)₹648 crore (46% YoY growth)—
    Net Loss (₹ in crores)₹370 crore (down by around 45%)₹17 crore (drop from ₹74 crore)
    GOV (Gross Order Value)₹4,257 crore₹2,461 crore (2.5x of Q2 FY24)

    Rapido has shown rapid growth in the past years. The company’s total revenue in FY24 was ₹ 648 crores, which is about 46% more than last year (₹ 443 crores). During the same period, the company has also reduced its losses, the loss was ₹ 675 crores in FY23 which reduced to ₹ 370 crores in FY24.

    Rapido’s Gross Order Value (GOV) also doubled to ₹ 4,257 crores in FY24. The main reason for this GOV growth was the increasing demand for the company’s services and expansion in tier-2/tier-3 cities.

    Read Also: Blinkit Case Study: Business Model, Financials, and SWOT Analysis

    SWOT Analysis of Rapido

    Strengths

    • Low-cost mobility solution: Rapido offers an affordable option for two-wheeler riding, which is a better option for users troubled by traffic in metros and big cities. Its rides are much cheaper than taxis or autos.
    • Strong network in big cities: Rapido has made its presence felt in 100+ cities in India, including metro cities like Delhi, Bangalore, Hyderabad and Chennai. Its driver network is also constantly growing.
    • Ideal for quick pickups and short distance rides: Rapido is a fast, convenient and reliable medium for short distance trips. The bike easily passes through the traffic, which saves time.
    • Partner-centric model: Rapido offers flexible timings, good incentives and an easy joining process to its captains (drivers), which helps it attract more riders to the platform.

    Weaknesses

    • Safety concerns: Bike rides have less safety than taxis, especially for women or in bad weather. This makes many users reluctant to book a ride.
    • Regulatory challenges: Many states do not have clear rules regarding bike taxis or they are banned. This affects the company’s growth.
    • Limited earnings for drivers: Due to excessive competition and cheap rates, the earnings of drivers are limited, which can make it difficult for them to remain associated with the platform.

    Opportunities

    • Opportunity to expand in smaller cities: Rapido can now enter tier 2 and tier 3 cities where there is a lack of public transport and there is a demand for cheap rides.
    • Last mile delivery service: Rapido can also quickly enter the last mile delivery market through its logistics service “Rapido Local”.
    • Technology upgrades and AI-based features: Using AI and data analytics, Rapido can perform route optimization, user personalization and safety enhancement.

    Threats

    • Increasing competition: Increasing competition from Ola, Uber and new local startups can affect Rapido’s market share.
    • Changes in government policies: If state governments ban bike taxis, Rapido’s operation capacity may decrease.
    • Lack of customer trust: Many users consider bike taxis to be less safe, which makes it difficult to build brand trust.

    Conclusion

    Rapido has changed the way of commuting in cities with less cost, less time and less hassle. This has become a big relief especially for the middle class and students. However, obstacles like legal policy and regulation still stand in its way. But the way the company has grown rapidly, focused on technology and won the trust of the people shows that it has the strength to run for the long haul. If it gets policy support, Rapido can become a big name in India’s mobility sector.

    S.NO.Check Out These Interesting Posts You Might Enjoy!
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    5CAMS Case Study: Business Model, KPIs, and SWOT Analysis
    6Kalyan Jewellers Case Study: Business Model, Marketing Strategy & SWOT

    Frequently Asked Questions (FAQs)

    1. Who is the CEO of Rapido?

      The CEO of Rapido is Aravind Sanka, who is also the co-founder of the company.

    2. Who owns Rapido?

      Rapido is owned by its three founders Aravind Sanka, Rishikesh SR and Pavan Guntupalli and some investors.

    3. Who invested in Rapido?

      Rapido has investments from several major investors, such as WestBridge Capital, Nexus Venture Partners, and Swiggy has also made strategic investments.

    4. Can anyone become a Rapido rider?

      Yes, if you have a bike, valid license and required documents then you can register.

    5. What makes Rapido different from Ola or Uber?

      Rapido primarily provides bike riding service, which is fast, affordable and convenient in traffic.

  • Trump Tariffs on India: Trade vs Russian Oil

    Trump Tariffs on India: Trade vs Russian Oil

    A new crisis has erupted in India–US relations after the Trump administration imposed tariffs on Indian exports linked to India’s purchases of Russian crude. Meanwhile, India is set to meet about 36-40% of its total crude oil imports from Russian oil in 2024-25, leading to huge energy savings and keeping domestic prices in check.

    Now the question is: Will India give up its cheap energy and prioritize the US market, or will it maintain energy security by losing trade benefits?

    Why India Relies on Russian Oil

    After the Western sanctions on Ukraine, India increased its imports of Russian oil. Now, by January-June 2025, India is meeting about 34% of its total crude oil consumption from Russia, which was less than 2% earlier. In the entire financial year 2024–25, the share of Russian oil in India’s total oil imports reached about 36%, while the share of the Middle East (OPEC) declined to 48.5%.

    • Heavy dependence on oil: India imports more than 85% of its total crude oil needs, making the country dependent on global markets for energy security.
    • Discount is a big reason for the shift towards Russian crude: After the Ukraine crisis in 2022, Russia sold oil at a huge discount amid Western sanctions. On this occasion, India increased its inclination towards Russian oil. Earlier this share was only less than 2%, but now it has reached about 40%.

    Year-on-year savings : 

    YearPart of RussiaSavings (estimated)
    FY22–2323%$5.1 billion
    FY23–2435%$7.9 billion
    • Resorting to long-term contracts and diversification strategies: Many refiners are ensuring supplies, especially from government term deals (barter annual/long-term contracts) to mitigate any volatility or sudden cuts from Russia. It is not easy to stop such contracts suddenly, so private companies like Reliance, Nayara Energy are continuing to buy.
    • Direction of change: Looking for alternative sources: Government refiners like BPCL are now increasing supplies from the Middle East (such as Omani oil), especially in January to make up for the shortage of Russian oil. In addition, the country has started buying oil from 39 countries, earlier this number was 27, ensuring energy security and diversity of options.

    Chronology of the Tariff Escalation

    The recent tariff dispute between the US and India is not just a trade dispute, but an issue deeply intertwined with geopolitical tensions and energy policy. In July–August 2025, the Trump administration put direct pressure on many of India’s export sectors by raising tariffs in two phases.

    1. First blow – 25% “reciprocal” tariff (July 30, 2025) : In an executive order issued from the White House on July 30, 2025, the US administration announced the imposition of a 25% reciprocal tariff. Its rationale was that this duty is being imposed in response to the tariffs imposed by India on some products coming from the US.

    • Affected sectors: Categories such as textiles, gems and jewellery, chemicals, pharmaceuticals and shrimp.
    • Effective date: From August 1, 2025.

    2. Second blow – Additional 25% “penalty” (August 6, 2025) : Another order was issued on August 6, 2025, adding an additional 25% penalty tariff. This was directly linked to India’s continued imports of Russian crude oil, which the Trump administration viewed as “financial support to Russia’s war machine.” The total tariff after this penalty became 50%. 

    Effective date : 21 days after the August 6 order, i.e. from August 27, 2025.

    3. Exemption for goods in transit : The US made a provision that if the shipment was in transit before the order was issued and arrived on time, it would be exempt from the new tariff.

    DateActionOutcome
    July 30, 202525%First set of punitive duties imposed on India
    6 August 2025Additional 25% penalty (on Russian oil)Total tariff rate increased to 50%
    27 August 2025 (Estimated)Inclusion of shipments already in transitFull-scale implementation of tariffs

    Comparative Impact: Oil Savings vs Trade Losses

    India currently faces a balancing challenge on the one hand, the savings from cheap oil from Russia, and on the other, the threat of nearly 50% tariffs from the US that could hit its key export sectors.

    What do the facts and figures say?

    • The scale of oil savings : According to an ICRA report, India saved about $5.1 billion by buying discounted crude from Russia in FY23. Another projection suggests that the discounts have enabled annual savings of $7.9 billion in 11 months of FY24.
    • The chilling effect of the 50% tariff :Recent reports suggest that the tariffs imposed by Trump could threaten India’s US exports worth about $87 billion. Textiles, jewellery, pharma and petrochemicals critical exports are constantly at risk.
    • Oil Import Reduction and 25% tariff hit : Even if India reduces Russian oil imports and only the 25% tariff stays in place, trade losses of up to $8–15 billion are expected.

    Impact on US-India trade relations

    In early 2025, PM Modi and President Trump set a trade goal called “Mission 500”, seeking to take bilateral trade to $500 billion by 2030. But the Trump administration’s displeasure over India’s oil purchases from Russia brought a wave of tariffs instead a dampener on India-US trade.

    1. Tariff policy benefits domestic industry

    Tariffs have another side: adding to domestic industries.

    The PHD Chamber report shows that 25% tariffs would impact exports worth about $8.1 billion, but the impact on overall GDP would be just 0.19% and on global exports 1.87%, as India’s economy is diversified. In response, the chamber has laid out four-fold strategies:

    • Bundle pricing agreements with global retailers (e.g. Walmart, Amazon)
    • Development of premium product options
    • Expanding trade to new markets (EU, Canada, Latin America)
    • Increasing production in the US through on-shore partnerships.

    2. India’s strategic positioning in the global market

    The tariff dispute has brought about several changes in India’s foreign policy.According to the Financial Times, while the two countries have started off on a positive note in 2025, the trade dispute has dented the Indo-Pacific strategy Quad meetings are in jeopardy, and India’s ties with China-Russia appear to be strengthening. At the same time, a July report by NITI Aayog shows that the tariff structure in the US has given India an advantage over American competitors in 22 key export categories such as electronics and automobiles. Furthermore, while taking over the Chairmanship of BRICS, Prime Minister Modi has proposed to redefine the organization as “Resilience and Innovation”, which brings out India’s multi-pronged strategic strength.

    Impact of cheap Russian crude on India and investors

    India has imported record-low crude oil from Russia, which has reduced the country’s oil import bill. This is giving the government the benefit of revenue savings and helping in controlling fuel inflation. Its indirect effect for investors is that if petrol and diesel prices remain stable, the operating costs of transport, FMCG and manufacturing companies may reduce. This may lead to margin improvement in the stocks of these sectors and potential growth in stock prices. Brokerage houses are also monitoring this trend so that correct sector-based investment advice can be given to clients.

    Conclusion

    Buying cheap crude from Russia has been a profitable deal for India. This has kept fuel prices under control and the government’s import bill has also come down. This has reflected in the stock market, especially on oil, gas and shipping companies. But the way forward is not completely clear. International conditions, sanctions and price fluctuations can change the situation. It is wise for investors to think long-term and assess the current global conditions before taking a decision.

    Frequently Asked Questions (FAQs)

    1. What are the “Trump Tariffs on India”?

      The Trump administration imposed tariffs in two phases: a 25% reciprocal duty and an additional 25% penalty tied to Russian oil, raising total tariffs to 50%.

    2. How much of India’s crude now comes from Russia?

      As of 2025, Russia supplies roughly 34 percent of India’s crude oil imports.

    3. Will India cut Russian oil now?

      The government has indicated that Russian oil imports will continue in the near term, supported by existing term contracts and diversification through alternative suppliers for energy security.

    4. What should Indian exporters do right now?

      Look at alternative markets, tune pricing/FX-hedging, and keep supply-chain/finishing flexible.

    5. What’s the potential GDP impact for India?

      Analysts estimate that if tariffs continue for a long time, GDP growth could be reduced by 0.3-0.4%.

  • Understanding Futures Pricing Formula

    Understanding Futures Pricing Formula

    Why does the futures price of a stock or commodity often differ from the spot price? Is this just the effect of demand-supply or is there some mathematical logic behind it? Actually, futures pricing is based on a specific calculation, which is called the futures pricing formula.

    In this blog, we will understand in simple language how futures contracts are priced, what are the factors behind it, and how this formula can help you understand the market better.

    What Are Futures Contracts?

    Futures contracts are an agreement in which two parties (buyer and seller) agree to buy or sell an asset at a fixed price on a fixed date in the future. This asset can be anything such as gold, crude oil, stocks, index or currency.

    Example: Suppose a coffee importer needs a large quantity of coffee after 3 months. He wants to fix the price of coffee today itself so that even if the price increases in the future, his expenses do not increase. For this he makes a futures contract.

    Who uses futures contracts?

    Mainly two types of people are involved in it:

    • Hedgers: Those who want to protect themselves from price risk.
    • Speculators: Those who want to earn profit from price movement.

    Types of Futures:

    • Commodities Futures (like gold, silver, coffee)
    • Stock Index Futures (like Nifty, Bank Nifty)
    • Currency Futures (USD/INR, EUR/INR)
    • Interest Rate Futures (based on government bonds)

    All of these use the futures pricing formula, which decides what the future price of an asset should be.

    The Basics of Futures Pricing

    Futures contract prices often differ from spot prices, and the main reason for this is the Cost of Carry Model. This model shows that the cost (or benefit) of buying an asset today and holding it in the future affects futures pricing. It consists of three key elements:

    • Risk-Free Interest Rate (r): The interest that would be earned on the amount of money if it were invested in a safe investment.
    • Storage and Insurance Cost: These have a big impact, especially in commodities (e.g. gold, crude oil).
    • Income Yield (d): Some assets, such as stocks or indices, provide dividends or yields over the holding period, which pull the price down.

    All of these factors combine to determine whether the futures price will be at a premium (above) or a discount (below) the spot price.

    No-Arbitrage Pricing Principle : The most important principle governing futures pricing in modern financial markets is the No Arbitrage Principle. Accordingly, if the difference between the futures price and the spot price is so great that a trader can make a profit without any risk, they immediately adopt an arbitrage strategy. The result is that the imbalance in pricing is quickly eliminated and the futures come closer to its theoretical value.

    For example, if the futures price is too high, traders will buy the asset today and sell it in futures — which will increase demand and balance the price.

    Futures Pricing Formula

    In the Indian markets, futures contracts are priced using a discrete compounding formula, not the exponential version often used in global finance.

    F = S * [1 + (rf​ * (x/365)) ​− d]

    Where:

    • F = Futures Price
    • S = Spot Price
    • rf = Risk-Free Interest Rate (e.g., RBI Treasury Bill rates)
    • d = Dividend Yield (if any)
    • x = Number of days till expiry

    This formula applies specifically to index futures and stock futures. In commodity futures, storage and logistics costs are also added to it. This futures pricing formula helps to keep the prices in the market fair, logical and prediction-based.

    Real-World Examples of Futures Pricing

    Now we will understand how to apply the futures pricing formula practically with data.

    Suppose in July 2025:

    • Spot price of XYZ Corp = ₹2,380.5
    • Risk-free rate (r_f) = 8.3528% per annum
    • Days to expiry = 7
    • Dividend (d) = 0

    F = 2380.5 * [1 + (0.083528 * (7/365​)) − 0]

    F = 2380.5 * [1+0.0016] ≈ ₹2,384.06

    So, the fair value of the futures contract after 7 days is ₹2,384.06.

    When the Futures Pricing Formula Breaks Down?

    • Market inefficiency : The futures pricing formula does not work well when there is low liquidity or sudden news-driven volatility in the market. In such a situation, prices may look different from the formula due to demand–supply mismatch.
    • Expectation-based pricing : Many times traders price futures contracts based on what they think the future spot price will be rather than the pure cost of carry. This also leads to deviation from the formula.
    • Margin requirements and Sentiment : Market sentiment and changes in margins by brokers also affect the pricing of futures. Panic selling or bullish speculation can cause prices to deviate significantly from the theoretical value.

    Example: During the 2020 crash, Nifty futures prices were often trading 150-200 points below the actual spot. During extreme events, like the 2020 crash, Nifty futures often traded 150–200 points below spot. In such times, liquidity stress and sentiment temporarily overpower the cost-of-carry logic. This makes it clear that sometimes emotions and market conditions prove to be more effective than formula.

    Applications of the Futures Pricing Formula

    • Used in Hedging : Large corporates and exporters use this formula to determine how expensive or cheap it will be for them to hedge an asset in the future. This reduces their risk and makes budgeting easier.
    • Arbitrage Trading : When the futures price is above or below its theoretical value, professional traders immediately catch the arbitrage opportunity. Even a small difference between the spot and futures price can become an opportunity to profit in lakhs.
    • Valuation and Estimation : Analysts use this formula to estimate how the market is looking at interest rates, currency rates or stock movements in the next few months. Futures price in a way shows a forward-looking perspective of the market.
    • Unique Insight : Professional traders compare the theoretical futures price and the actual traded price all the time. As the difference increases, they either hedge or create an arbitrage position — this edge sets them apart from the rest.

    Common Myths Around Futures 

    • Futures prices predict the future : People often believe that futures prices indicate the future value of an asset. In reality, the futures pricing formula simply adds the cost of carry to the spot price to give a logical price—it is not a prediction.
    • A premium in futures means the market is bullish : If the futures price is higher than the spot, it is not considered a bullish signal. This difference is often just due to interest rates, dividends, or holding costs.
    • Expensive futures mean you should avoid : If the futures price is high, it does not necessarily mean that it is overvalued. This may include things like hedge demand, liquidity, or supply constraints.
    • Futures should always be equal to or cheaper than the spot : There is often the belief that futures should trade around the spot, but it is normal for them to vary due to cost of carry, volatility, and demand/supply in different assets.
    • Futures are only for speculative traders : Although speculation does occur, futures are primarily used for hedging and price discovery. Institutions and businesses use them to actively manage risk.

    Conclusion

    Futures pricing can be understood clearly through the cost of carry model. The fair value of a futures contract is determined by the spot price adjusted for interest rates, dividends or yields, and the time remaining to expiry. By applying this formula, traders and investors can evaluate whether a futures contract is trading at fair value, a premium, or a discount. This understanding is critical for making informed decisions in hedging, arbitrage, and speculation. It is advised to consult a financial advisor before trading in futures contracts.

    Frequently Asked Questions (FAQs)

    1. What is the formula for futures pricing?

      The basic formula for calculating futures price is: F = S * [1 + (rf​ * (x/365)) ​− d], where, S = Spot Price , r = Risk-Free Interest Rate , x = Number of days till expiry and d = Dividend Yield .

    2. Why does the futures price differ from the spot price?

      Futures price is different from spot price because of factors like interest cost, storage, and time left to expiry.

    3. Does futures pricing apply to all asset classes?

      Yes, this formula applies to commodities, indices, currencies and other instruments — only the cost of carry may vary.

    4. Can futures prices be lower than spot prices?

      Yes, if the market is in backwardation, then futures prices can be lower than spot prices.

    5. Is futures pricing important for retail traders?

      Absolutely, this helps you identify overvalued or undervalued contracts and make better decisions.

  • What is Rollovers in Stock Market?

    What is Rollovers in Stock Market?

    Every month, as futures contracts near expiry, a unique buzz builds in the stock market. Instead of closing their positions, many traders carry them forward into the next month’s series. This process is called a rollover. Still, a lot of people wonder what rollover really means in the stock market, how it works, and why it matters.

    In this blog, we will explain rollover in simple words and show why carrying futures positions forward is an important part of trading.

    What is Rollover in the Stock Market?

    Rollover in the stock market means transferring your futures position from the current month’s series to the next month’s series that too before expiry. When a trader moves his position to the next month, it is called rollover in the stock market.

    This process happens on both sides : 

    • If you are holding a long position (buy) in the current month’s futures contract, you can roll it over by closing that position and simultaneously creating a new long position in the next month’s contract. This allows you to continue your bullish view without interruption.
    • On the other hand, if you are holding a short position (sell), you can also maintain it through rollover. To do this, you square off your existing short position in the current series and open a fresh short position in the next month’s futures. This way, your bearish view remains intact even after the current contract expires.

    In India, the monthly expiry of futures contracts usually takes place on the last working Thursday of every month. Before that, traders roll over their positions and shift them to the next month.

    The purpose of a rollover is to extend an open futures position into the next month’s contract without letting it expire. This process helps gauge overall market sentiment and reveals whether traders are maintaining or shifting their confidence in the prevailing trend.

    Why Rollovers Matter: Purpose and Significance

    In futures trading, rollover in the stock market is not just a position transfer, but it also gives many big signals and benefits. Know below what is the importance of rollover and why this data is so important for market analysts and traders.

    • Avoiding settlement : Every futures contract has a fixed expiry date. If the trader holds it till expiry, he has to face settlement or delivery. But when the trader wants to continue his view further, he closes the position of the current series and takes the same position again in the next series. This is called rollover, which can avoid settlement.
    • Correct use of leverage : For traders trading on margin, rollover is an effective way to maintain their position in less funds. If a trade is profitable and the trader wants to hold it till the next month, he can rollover without investing additional capital. This makes better use of capital possible.
    • Change in volume and liquidity : As the expiry approaches, traders start building positions in the new month’s contract by exiting the old futures contract. Due to this, trading volume and liquidity gradually shift to the next series. Keeping this change in mind, experienced traders take timely entry in the new series so that better prices and volume can be obtained.
    • Indication of Market Sentiment : Rollover data helps in understanding the mood of the market. If most traders are increasing their positions in the same direction till the next month, then it shows that confidence remains in the market. On the other hand, if the rollover is decreasing or is happening in the opposite direction, then it may be a sign of uncertainty or change in trend. This is why analysts and traders take this data very seriously.

    How to Roll Over Futures Positions

    How to roll over futures in the stock market is a question that comes to the mind of every new trader. The process of rollover is technically easy, but timing, cost and correct entry are very important in it.

    • Square off the existing position : The first step to rollover is to close your existing futures position before expiry. If you have bought, then sell it, and if you have sold, then buy it. This closes the position of your old series.
    • Create the same position in the next series : Now open a new position in the same direction in the next month’s futures series of the same stock or index. This keeps your trading view continuous without a break. For example, if you bought Nifty in July, then now buy Nifty of August series.
    • Keep costs in mind : There are some important costs involved in rollovers such as brokerage charges, Securities Transaction Tax (STT), and bid-ask spread. Sometimes, when liquidity is low in the new series, there is a slight difference in the prices, which can increase the trading cost. Therefore, it is better to do price trend, volume and chart analysis while rolling over.

    Rollover is not just a technical move, it is a way to keep your trading strategy on track. A rollover done at the right time not only manages risk, but also helps in understanding market sentiment.

    Rollover vs Fresh Positions: What’s the Difference?

    ParameterRollover PositionFresh Position
    DefinitionCarrying forward an existing futures position to the next month’s contractInitiating a brand-new position in the next month’s contract without any prior link
    PurposeTo continue an existing market view by shifting position before expiryTo enter a new trading opportunity based on current market trends
    Where It ReflectsVisible in rollover data and open interest shift between seriesReflected through a rise in open interest due to new participants
    Market SentimentIndicates that traders are maintaining confidence in their earlier viewSuggests new traders are entering with a fresh outlook or expectation
    Risk FactorCan lead to losses if the previous trend reverses unexpectedlyBased on current data and trend, so risk may be more manageable
    Trading CostSlightly higher due to exit and re-entry (two transactions)Lower cost as it’s a single entry transaction

    Who Uses Rollovers: Retail vs Institutional Perspective

    Rollover in the stock market is used strategically not only by retail traders but also by large institutional players.

    Retail traders usually rollover to maintain their speculative positions till the next month. Their aim is to keep following the trend in low margin and capture short term profits.

    On the other hand, institutional investors, such as hedge funds, mutual funds or prop trading firms, use rollover for long term strategy or hedging. These institutions trade in large volumes and their activities affect the direction of the market.

    The rollover data of FII and DII is of special importance, because rolling their large positions indicates whether they are positive or negative about the market.

    Risks & Mistakes to Avoid While Rolling Over

    While doing rollovers in futures trading, traders often face huge losses due to small mistakes. The 5 important points given below will help you to be cautious.

    • Lack of liquidity : The volume in the next series of futures contracts is low in the beginning. Due to low liquidity, execution can be slow or at a high price.
    • Risk of price slippage : At the time of rollover, prices can change rapidly, making it difficult to get entry or exit at the desired rate.
    • Wrong calculation of spread : Not estimating the bid-ask spread and rollover cost correctly can reduce trading profits.
    • Not re-assessing the view : Many traders rollover with the old view, without seeing whether the market direction is still the same or not.
    • Wrong selection of time : Waiting till the last day for rollover can be risky. It is better to plan the timing and roll in advance.

    Rollover Process: An Example

    The budget week of February 2025 saw a unique activity in Bank Nifty futures. Bank Nifty saw a huge rollover with high open interest a few days before expiry and premiums on new contracts rising. This indicated that traders wanted to hold their bullish positions for the next month. It was not just numbers it reflected positive budget expectations across the banking sector.

    A smart trader could have read this data and understood that there was bullish carry forward and not short covering in the market. This meant that the big players were expecting a rally in banking stocks.

    This teaches us that it is important to look at rollover data not just in percentage terms but also in the context of market conditions and news. Rollover, seen in the right context, can become a strong trading signal.

    Conclusion 

    Every trade in the market is not only about profit or loss; it also reflects the sentiment and expectations of participants. Rollover is one such signal. When a position is carried forward to the next month’s contract, it reflects the trader’s confidence in continuing a particular view on future price movement. As each expiry approaches, monitoring rollover activity can provide valuable insight into market sentiment and may serve as an important input for developing future trading strategies.

    S.NO.Check Out These Interesting Posts You Might Enjoy!
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    Frequently Asked Questions (FAQs)

    1. What is rollover in the stock market?

      Rollover means transferring your existing futures position to the next month’s series.

    2. When does rollover happen in India?

      Rollover is usually highest in the last week before the expiry of every month.

    3. Is rollover a good or bad signal?

      It depends on which direction the rollover is taking place and with what open interest.

    4. How to roll over futures manually?

      After squaring off the position of the old series, a new position has to be taken in the same direction in the next series.

    5. Do all traders need to roll over?

      No, only those traders who want to maintain the trading view even after expiry.

    6. Does rollover affect stock prices?

      Yes, more or less rollover can affect the price of the stock or index according to the trend, sentiment.

    7. Where can I see rollover data?

      Rollover data is available on the NSE website, trading platforms and market research reports.

  • What is Swaps Derivatives?

    What is Swaps Derivatives?

    Swaps are one of the most powerful yet lesser-known instruments in the world of derivatives. Unlike futures, options or forwards that most people are familiar with, swaps are agreements between two parties to exchange financial obligations. They are widely used to manage risks such as interest rate fluctuations and currency movements, making them an essential part of today’s global financial markets.

    In this blog we will explain what swap derivatives are, how they work and the different types you should know about. Whether you are a finance student, trader or investor, this guide will help you build a clear understanding of swaps.

    What is Swap in Derivatives? 

    Swaps derivatives are a type of financial contract in which two parties agree to exchange future cash flows. The exchanged cash flows are typically linked to financial variables such as interest rates, currencies, commodity prices, or credit risk, and the primary purpose of swaps is to hedge risk, manage exposure, or speculate on market movements. This exchange takes place on the basis of predefined rules and a notional amount, but the actual amount is not exchanged. Swaps often take place in the OTC (Over-the-Counter) market, that is, they are not listed on a bank or exchange, but are directly negotiated between two parties. This is why they are completely customized; the parties can set the terms as per their convenience. Not being standardized like futures and options, swaps in derivatives are more flexible, but they also have counterparty risk associated with them. The biggest advantage of swaps derivatives is that with their help companies can protect themselves from interest rate risk, currency fluctuation or commodity price volatility. Sometimes they are also used for arbitrage or speculative purposes.

    History & Evolution of Swaps Derivatives

    1. Early 1980s

    Interest rate swaps were conceptualized in the late 1970s, and were used in the interbank market in the early 1980s. The British Bankers’ Association standardized them, making them increasingly popular in financial markets.

    2. 1981: The First Currency Swap between IBM and World Bank

    The first documented and high-profile deal involving swap derivatives occurred in 1981, when IBM and the World Bank signed the first currency swap agreement. The deal proved to be a major turning point in international financial strategy.

    3. 1990s: The Rise of Credit Default Swaps (CDS)

    Bankers Trust in 1991 and J.P. Morgan in 1994 used CDS as a form of credit risk management. It was a type of contract that provided financial protection in case of default.

    4. 2008: Global Financial Crisis and the role of CDS

    Excessive use of CDS without proper controls worsened the financial crisis of 2008. Large institutions like AIG came close to collapse due to CDS exposure, after which global regulators tightened regulation of the swap market.

    5. 2025 Statistics

    According to the ISDA report, the notional outstanding of global OTC derivatives was $699.5 trillion by the second half of 2024, of which interest rate derivatives alone accounted for $579 trillion. This segment makes up the largest part of the OTC derivatives market and has recorded a growth of around 4.9% year-on-year.

    How Do Swaps Derivatives Work? 

    • Nature of the contract : A swap derivative is a bilateral contract in which two parties agree to exchange future payments on pre-determined terms for a fixed period of time. These payments are based on an underlying financial factor, such as interest rates or currency rates.
    • Calculation of payments : In this contract, payments are fixed based on a fixed notional amount. This amount is only for calculation, and there is no actual transaction. For example, one party pays at a fixed interest rate, while the other pays at a floating rate .
    • Interval and settlement : Both parties calculate their respective payment amounts at a fixed interval (such as every 6 months). In the end, only the difference between the two payments is transacted. This is called net settlement. This prevents either party from making a full payment unnecessarily.
    • Change in value : The value of a swap contract keeps changing over time. As the underlying rate (e.g. interest rate) fluctuates, the present value of the contract fluctuates. This is called the mark-to-market valuation.
    • Purpose and utility : The purpose of this process is not just to exchange payments but to strategically manage risk. Corporates and financial institutions use it to manage interest rate risk or control costs without changing their existing loan or investment structure.

    Types of Swaps in Derivatives

    1. Interest Rate Swap

    In this swap, two parties transact interest rates – one at a fixed rate and the other at a floating rate. Its purpose is to avoid the risk arising from fluctuations in interest rates.

    Example: Suppose an Indian company has taken a loan of ₹ 100 crore from a bank on which it has to pay 9% fixed interest every year. But the company feels that floating rates will remain low in the future, so it does a swap deal with a bank in which it starts paying at a floating rate (eg MIBOR + 1%) instead of a fixed rate. This allows the company to take advantage of a possible fall in interest rates.

    2. Currency Swap

    In this, two parties exchange the principal and interest of loans taken in different currencies. These swaps are especially done when a company has to borrow in foreign currency but wants to avoid risk.

    Example: An Indian company has taken a loan from the US in USD but it is easier to pay in rupees in the future. So it does a currency swap with an American company – the Indian company pays in dollars, and the American company in INR. This saves both parties from risk by paying in their respective country’s currency.

    3. Commodity Swap

    In this swap, two parties make payments based on mutually agreed price and market price of a commodity such as oil, gas, or metal. This is done to protect against price uncertainty.

    Example: Suppose an Indian airline company needs 1 lakh liters of jet fuel every month. It fears that oil prices may rise in the future. It does such a swap with an oil supplier in which a fixed price (eg ₹ 85 per liter) is fixed every month, whether the market price is ₹ 90 or ₹ 75. This gives it stability in the budget.

    4. Credit Default Swap (CDS)

    This is a contract in which one party promises to compensate the other party in case of default of a loan or bond. This is a kind of “credit insurance”.

    Example: Suppose an Indian bank has given a big loan to a real estate company. It fears that the company may go bankrupt. The bank takes CDS from an insurance company. Now if that real estate company does not repay the loan, the insurance company will compensate for the loss.

    5. Equity Swap

    In this, two parties make payment based on the return of the stock market and a fixed interest rate. In this, actual shares are not purchased, only the return is transacted.

    Example: Suppose an Indian mutual fund wants a return of Nifty 50 but does not want to buy shares directly. It does an equity swap with a bank in which the bank gives it a return of Nifty 50, and in return the fund gives fixed interest (eg 7%).

    Benefits of Using Swap Derivatives 

    • Protection from interest rate risk : Swaps allow switching between fixed and floating rates, allowing companies to hedge their expenses against interest rate fluctuations.
    • Control of currency risk : Currency swaps help manage the exchange rate risk associated with foreign currency loans or liabilities.
    • Cost reduction : Swaps with more favourable terms can help organizations reduce their financing costs and improve cash flow.
    • Customised financial strategy : Swaps can be customised, allowing companies to control their balance sheet risk in a customised way.

    Risks Involved in Swap Derivatives

    • Counterparty Risk : Swap derivatives are often over-the-counter (OTC), that is, they are traded directly between two parties rather than through an exchange. In such a situation, if one party does not fulfill the terms of the contract (defaults), then the other party can suffer huge losses. This risk increases further, especially in long-term swaps.
    • Liquidity Risk : Swap contracts are highly customized, which makes it difficult to sell them in the secondary market or exit them prematurely. This is why the investor or institution has to remain in it for the entire period, even if the market conditions change.
    • Valuation Risk : Since swaps do not have a uniform market price, valuing them is challenging. Complex financial models and assumptions are required to mark them to market. Valuation based on incorrect estimates can lead to huge losses.
    • Regulatory Risk : After the 2008 financial crisis, derivatives regulations have been tightened around the world. In India, there has been increased oversight of OTC derivatives by RBI and SEBI. Many swaps now need to be settled through a clearing house, increasing the regulatory burden and reporting.
    • Market Risk : Swap contracts depend on market-linked factors such as interest rates, currency rates, or commodity prices. If these change suddenly or unfavorably, it can expose the parties to huge losses. Without the right hedging strategy, this risk can be huge.

    Why Do Investors and Institutions Use Swaps?

    • Risk Management : The most common use of swaps is to protect against fluctuations in interest rates, currency rates or commodity prices. This helps companies stabilize their future payments.
    • Speculative Use : Some professional traders use swaps to bet on the direction of the market, such as whether interest rates will rise or fall. In this, a position can be taken without buying the actual asset.
    • Arbitrage Opportunities : When there is a price difference in two financial markets, investors can take advantage of low cost and high returns through swaps.
    • Balance Sheet Management : Banks and corporate entities use swaps to improve their asset-liability matching and cash flow structure.
    • Customised Financial Structure : Swaps are completely customisable, allowing companies to design them to suit their needs and precisely control risk.

    Conclusion

    Swap derivatives have become an essential tool in today’s complex financial environment for managing interest rate risks, foreign exchange volatility, etc. They are different from traditional derivatives because they are completely customizable. Although they come with risks, but with the right strategy and understanding, they can be very beneficial for institutions and experienced investors. It is important to examine them closely and seek professional advice before using them.

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    Frequently Asked Questions (FAQs)

    1. What is a swap derivative in simple terms?

      It is an agreement in which two parties exchange money or returns in the future.

    2. Are swaps only used for interest rates?

      No, they are used for a variety of assets such as currency, commodity and credit risk.

    3. Are swap contracts risky?

      Yes, they involve a variety of risks such as counterparty risk and market risk.

    4. Can individual investors use swap derivatives?

      Not usually, they are designed for large investors and institutions.

    5. Are swap contracts legally binding?

      Yes, these are fully legal contracts and parties are required to make payments as per the terms.

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