Day: August 6, 2025

The Reserve Bank of India (RBI) held its benchmark repo rate unchanged at 5.5% in its August 2025 policy review, maintaining a neutral stance amid global trade uncertainties and cautious inflation projections. While the move was widely anticipated, it triggered a broad-based decline in interest rate-sensitive sectors, including automobiles, real estate, and banking, as investors recalibrated expectations for monetary easing.

Policy Highlights

• Repo Rate: Held steady at 5.5%
• Inflation Forecast: Revised down to 3.1% for FY26
• GDP Growth Projection: Retained at 6.5%
• RBI Governor Sanjay Malhotra emphasized resilience in domestic growth but flagged risks from global trade tensions and seasonal inflation pressures.

Sectoral Impact

Auto Stocks

The BSE Auto index fell 0.85%, with notable declines in:

• Bosch: -4.85%
• Hyundai Motor India: -1.95%
• HeroMoto Corp: -1.31%
• Apollo Tyres: -1.07%
• Mahindra & Mahindra: -0.83%

While Bajaj Auto (+0.11%) and Eicher Motors (+0.03%) managed marginal gains, the overall sentiment remained weak due to rising fuel costs and lack of rate relief.

Realty Stocks

The BSE Realty index dropped 2.11%, led by:

• Prestige Estates: -2.68%
• DLF: -2.65%
• Godrej Properties: -2.42%
• Phoenix Mills: -2.40%
• Brigade Enterprises: -2.27%

Developers faced selling pressure as hopes for lower borrowing costs faded, impacting demand outlook and project financing.

Banking & Financials

The BSE Bankex slipped 0.04%, with mixed performance:

• IndusInd Bank: -2.58%
• IDFC First Bank: -1.34%
• Bank of Baroda: -0.46%
• Axis Bank: -0.16%
• SBI: -0.02%

Meanwhile, ICICI Bank (+0.22%) and HDFC Bank (+0.18%) posted modest gains. Financial services stocks like SBI Cards (-2.16%) and Jio Financial Services (-1.98%) also declined.

Market Sentiment

The RBI’s cautious tone and lack of forward guidance for rate cuts disappointed investors. Broader indices reflected the mood:

• Sensex: Down 80.99 points to 80,629.26
• Nifty 50: Down 75.35 points to 24,574.20
• Midcap & Smallcap indices: Fell 0.8% and 1.1%, respectively

Geopolitical tensions, including tariff threats from the U.S., added to the pressure on export-driven sectors like IT and Pharma.

Conclusion

The RBI’s decision to hold rates steady underscores its wait-and-watch approach amid global headwinds. While the economy remains resilient, the muted response from rate-sensitive sectors signals investor caution. Until clearer signals emerge on inflation and trade, markets may remain range-bound, with selective opportunities in defensives and quality financials.

Eqwires Research Analyst

Top-notch SEBI registered research analyst

Best SEBI registered Intraday tips provider

info@eqwires.com

Telegram | Facebook | Instagram

Call: +91 9624421555 / +91 9624461555

www.eqwires.com

The Indian stock market closed lower on August 6, 2025, as investors reacted to the Reserve Bank of India’s latest monetary policy decision and rising geopolitical tensions. The BSE Sensex declined by 166.26 points to settle at 80,543.99, while the NSE Nifty 50 dropped 75.35 points to end at 24,574.20.

RBI Policy: No Surprises, But No Comfort Either

• The RBI’s Monetary Policy Committee, led by Governor Sanjay Malhotra, maintained the repo rate at 5.5%, citing resilience in the domestic economy.
• While the decision was widely expected, the lack of dovish signals or fresh liquidity measures disappointed investors.
• Inflation projections were revised downward to 3.1% for FY26, but the RBI remained cautious amid global uncertainty.

Sectoral Snapshot

Lagging Sectors

• Auto: Nifty Auto fell 0.53%, with pressure on Tata Motors and Maruti amid weak demand outlook.
• Realty: Nifty Realty dropped 1.5%, reflecting concerns over rate-sensitive demand and muted earnings.
• IT & Pharma: Nifty IT and Nifty Pharma declined 1.7% and 2%, respectively, dragged by weak global cues and margin concerns.

Gaining Ground

• Public Sector Banks (PSBs): Bucked the trend with gains, supported by strong Q1 earnings and improved asset quality.
• Top Nifty Gainers: Asian Paints (+1.94%), HDFC Life (+1.88%), and M&M (+0.9%) led the pack.
• Top Nifty Losers: Wipro (-2.5%), Aun Pharma (-2.37%), Jio Financial (-2.06%), and Tech Mahindra (-2.05%) were among the worst performers.

Global & Political Overhang

• Market sentiment was further dented by former U.S. President Donald Trump’s threat to impose higher tariffs on Indian goods.
• This follows a recent 25% tariff hike on Indian imports, raising concerns over trade disruptions and export competitiveness.

Broader Market Trends

• Mid and Small Caps: NSE Midcap index fell 0.8%, Smallcap index lost over 1%, indicating broad-based selling.
• Advance-Decline Ratio: Skewed heavily in favor of decliners, reflecting cautious investor sentiment.

Conclusion

The August 6 session marked a pause in the recent rally, as macroeconomic caution and geopolitical jitters weighed on investor confidence. While PSBs offered a silver lining, the broader market remained subdued. Traders and investors will now look toward upcoming earnings reports and global developments for cues.

Eqwires Research Analyst

Top-notch SEBI registered research analyst

Best SEBI registered Intraday tips provider

info@eqwires.com

Telegram | Facebook | Instagram

Call: +91 9624421555 / +91 9624461555

www.eqwires.com

Air India is making a significant shift in its operational strategy by planning to bring key aircraft maintenance services in-house. The decision comes after years of dependency on AI Engineering Services Ltd. (AIESL) and is now bolstered by technical support from Singapore Airlines, which holds a 25.1% stake in Air India. This move is spurred by the tragic crash of Flight AI 171 in Ahmedabad and subsequent safety concerns highlighted by regulatory authorities.

Why the Shift?

• The crash of Flight AI 171 in June 2025 resulted in 241 fatalities and led to a rigorous safety audit across Indian carriers.
• Findings by the Directorate General of Civil Aviation (DGCA) revealed 93 safety-related issues in Air India, significantly more than competing airlines.
• Persistent complaints about AIESL’s service, including poor inspections and cabin hygiene, contributed to internal pressure for change.

Key Changes in Maintenance Operations

Air India will assume direct responsibility for:

• Pre-flight and daily inspections
• Minor aircraft repairs
• Routine operational maintenance

These tasks were previously managed externally by AIESL. The change is aligned with Tata Group’s broader mission to restructure and modernize Air India since acquiring it in 2022.

Singapore Airlines’ Contribution

Singapore Airlines is expected to:

• Share technical knowledge and best practices
• Assist in training Air India’s new maintenance teams
• Support operational readiness for an expanding fleet projected to reach 570 aircraft

This partnership builds on a historic collaboration, as Air India had provided maintenance support to Singapore Airlines during the 1970s.

Strategic Benefits

• Enhanced safety and regulatory compliance through tighter control
• Faster response times for on-ground technical issues
• Long-term cost efficiency from reduced third-party reliance

These steps aim to create a scalable and dependable maintenance ecosystem suitable for a growing global network.

Conclusion

Air India’s plan to internalize maintenance marks a bold evolution in its commitment to safety, efficiency, and service quality. With Singapore Airlines by its side, the airline is poised to redefine its technical capabilities and operational standards for the long haul.

Eqwires Research Analyst

Top-notch SEBI registered research analyst

Best SEBI registered Intraday tips provider

info@eqwires.com

Telegram | Facebook | Instagram

Call: +91 9624421555 / +91 9624461555

www.eqwires.com