Billionz Multi-Asset Weekly Newsletter
Hard Assets Outperform as Equities See Continued Sector Rotation
Global Developments:
Fed chair Warsh sounded hawkish in his speech at annual Jackson Hole symposium. This drove US yields and Dollar higher. Trump said US had struck a deal with Venezuela wherein it would control a large part of Venezuelan oil Reserves. US would control 55% of the effective output and from the JV and obtain the oil at cost. Earlier in the week reports of Iran and Oman making some progress on passage through the SoH had reduced risk premium a bit and caused Brent to slip below USD 90 per barrel. Possibility of RBI sucking out excess Rupee liquidity from banking system through ICRR (Incremental CRR) dampened sentiment a bit in bond markets. RBI continues a draw a line for USDINR at 95.80 for now it seems.
Global Equity Markets:
Domestic Equities
- Nifty50 remains relatively attractively valued at 20.3x trailing and 17.1x forward P/E.
- Midcap100 and Smallcap250 trade at a significant premium at 30.1x/27.5x and 29x/25.2x trailing/forward P/E, respectively.
- India VIX dropped to 10.68 from 11.07 last week
- NSE500 cumulative advance decline was -270 for the week.
- 292 stocks in NSE500 are currently above their 200 day moving average
- FPIs have invested net USD 3.2bn in domestic equities in August so far.
- Cyient and NMDC Steel led the gainers with over 23% gains, while BLS International and Balrampur Chini declined over 10% among the top losers.
- FIIs turned net sellers with ₹2,115 crore of outflows this week, while DIIs remained strong buyers with ₹19,308 crore of inflows.
Below are the graphical representations for how key benchmark indices performed this week & how sectoral indices performed this week:
Fixed Income
Global Rates:Global 10Y yields were broadly higher, led by Australia (+8bps), Japan (+5bps) and Germany (+3bps), while South Korea declined 7bps
India Rates & Flows:India’s 10Y G-sec yield rose 6bps to 6.91%, with liquidity surplus above ₹4 lakh crore; FPIs remained net sellers of domestic bonds, with USD 400mn outflows in August so far.
Real Estate
- ICICI Prudential Alternate Investments has raised commitments for its new Mumbai-focused residential real estate fund to ₹350 crore, targeting a ₹1,000 crore corpus with a ₹1,000 crore greenshoe option.
- The fund is targeting 20–25% underwriting returns through quasi-equity investments in premium redevelopment projects across micro-markets such as Malabar Hill, Pali Hill, BKC and Khar Road.
IPOs
- ESDS Software Solution (₹720 crore) and Priority Jewels (₹91.5 crore) are set to close on September 1, with both expected to list on September 4.
- The SME segment remains active, while Reliance Jio, Acko, OYO, NSE and Parle Products are among major upcoming mainboard IPOs awaiting issue dates.
Private Equity & Venture Capital
- LeapFrog Investments plans to deploy $80–100mn in India’s healthcare sector over the next two years, while funding remained active across space-tech, EVs and consumer businesses.
- TCS agreed to acquire Porsche’s MHP for €320mn, strengthening its automotive consulting and software-defined mobility capabilities in Europe.
Commodities
Crude and precious metals declined sharply, with WTI and Brent falling 4.2% and 6.7%, while gold and silver dropped 3.2% and 3.8%; natural gas and base metals remained largely stable.
What’s New in the World of Wealth Management:
August is on track to be a record month for Indian equity fundraising, with nearly $10 billion in deals already priced led by the government’s $3.2 billion block sale of LIC shares making it the strongest month for equity capital markets activity in over a year. The week’s standout corporate action was Lenskart’s Rs 1,857 crore block deal on August 28, where Alpha Wave Ventures sold approximately 2.95 crore shares at Rs 630 per sharea price 57% above the company’s November 2025 IPO price of Rs 402with Australia’s Retail Employees Superannuation Trust emerging as a key buyer, underscoring the growing interest of global pension capital in India’s listed consumer tech names. Ola Electric received a Rs 95.81 crore PLI-Auto incentive for FY2026-27its third consecutive year of PLI support reinforcing the government’s commitment to the EV two-wheeler sector, while Cipla received a VAI classification from the USFDA for its InvaGen facility in New York, removing a key regulatory overhang for the stock heading into the next earnings cycle.
Our Views: What we Like?
Equities : Benchmark Nifty50 continues to remain extremely range bound. We believe this is a time for active sector allocation and stock selection. Hard assets are likely to do well as bond yields soar. Metals and Realty have been outperforming while Auto and IT have been underperforming. We expect this trend to continue.
Fixed Income: Despite US treasury attempts to contain long term bond yields, there has not been much impact. We believe the market may test US treasury’ resolve. Domestically too, possibility of RBI sucking excess liquidity on more durable basis through Incremental CRR has dampened sentiment a bit. We are inching towards upper band of the 6.75-6.95% range we were seeing over next few weeks.
Commodities: We are bullish on base metals and precious metals and prefer adding exposure to these on dips. Energy prices are expected to be headline driven.
FX: We see the Rupee underperforming among EM currencies on crude vulnerabilities. We expect RBI to put a firm floor under USDINR pair and do not see runaway appreciation.
