Page 2 – National Institute of Securities Markets (NISM)

India’s Online Retail Flywheel: Digital Is Becoming the Default

Posted on September 25, 2025September 25, 2025 by Auburn Solutions

India’s consumption story is entering a structural, data-driven phase. What was once a convenience for a small urban cohort has become a nationwide habit: discovery, decision, and delivery are now increasingly digital. The complex numbers show why this shift is durable and why it strengthens India’s domestic demand rather than merely cannibalising offline retail.

What the latest India chart tells us

A recent multi-source report on “Rising preference of online retail in India” ( Deloitte Analysis, Swiggy DRHP, E-Com Express DRHP, Unicommerce) captures the arc clearly:

Total retail market (online + offline): from ~US$715 bn in 2018 to ~US$1.37–1.38 tn in 2025, and further to ~US$2.2–2.26 tn by 2030E.
Online retail: ~US$110–120 bn in 2025, rising to ~US$250–270 bn by 2030E – almost a 2.2× scale-up in five years.
Online penetration implied by these ranges: ~8–9% in 2025, improving to ~11–12% by 2030E (headline categories will be far higher).
D2C market: US$87 bn (2025) to US$267 bn (2030E) – a ~3× jump as brands bypass traditional channels.
Quick commerce: US$2.9–3.5 bn (2023) → US$5.2–6.1 bn (2024) → US$35–40 bn (2030E) – proof that “instant convenience” has become a mainstream behaviour, not a niche experiment.

In short, India is tracking towards a US$2.2T+ total retail economy by 2030 with a rapidly expanding online core, and two powerful adjacencies i.e. D2C and quick commerce which are compounding the shift.

The demand side: young, connected, confident and transacting more often

Smartphone reach: India has ~650–700 million smartphone users today and continues to add tens of millions annually.
Data consumption: Indians are among the highest per-capita mobile data users globally, with monthly usage per subscriber measured in dozens of GB, fuel for video discovery, live commerce and social shopping.
Income tailwind: Rising per-capita income and greater formalisation of employment are lifting discretionary categories i.e. electronics, beauty, travel, fashion and home improvement.
Trust infrastructure: Ratings, no-questions-asked returns and platform guarantees have lowered perceived risk, taking first-time buyers from “browse-only” to “buy now.”

Result: frequency and basket size are both trending up. The consumer is digital-first in behaviour, even before becoming high-income in wallet size.

The supply side: India’s world-class digital rails

India’s decisive advantage is infrastructural:

Real-time payments at near-zero cost: UPI has normalised instant, interoperable payments for everything from ₹50 kirana purchases to high-value electronics. In calendar 2023, UPI processed well over 100 billion transactions, with monthly run-rates now in the double-digit billions. This materially lifts online conversion and reduces cash-on-delivery friction.
Paperless onboarding: Aadhaar-enabled eKYC, account opening, and digital signatures have collapsed merchant set-up time from weeks to hours.
Data-sharing with consent: The Account Aggregator framework enables responsible credit underwriting, expanding BNPL/checkout credit for thin-file customers.

When payment and identity rails are public-good infrastructure, trust is cheap and scale comes earlier.

Logistics and fulfilment: speed with discipline

Coverage: E-commerce logistics networks today service 20,000+ PIN codes, covering the bulk of India’s consumption centres.
Unit economics: Higher stop density, micro-fulfilment, automated sortation, and dynamic routing are reducing per-order cost even as speed improves.
Return discipline: Better size guides, pre-shipment checks and exchange-first flows are curbing costly reverse logistics in fashion and electronics.
Service standards: Same-day delivery is now standard in metro clusters; 10–30 minute fulfilment for top essentials is rapidly spreading beyond the top 8 cities.

As density rises, each incremental order is cheaper to serve, creating a virtuous loop for platforms and sellers.

MSME digitisation and the rise of platform businesses

Setting up a digital storefront has never been easier:

SaaS tools provide catalogues, GST invoicing, reconciliation and analytics out of the box.
Logistics APIs allow merchants to ship nationwide from day one.
Marketplaces, influencers and live commerce offer demand pipes without upfront capex.
Open networks such as Open Network For Digital Commerce (ONDC) broaden reach and reduce gatekeeper dependency.

This democratisation of distribution expands the long tail of entrepreneurship and formalises spending that was previously invisible.

How India compares with China, the US and others

Online penetration of retail: China remains the world leader with ~25–30% of retail sales online (depending on category and time period). The UK is typically ~24–26%, and the US sits around ~15–17% on a blended basis. India’s implied ~8–12% trajectory (2025→2030E) shows headroom rather than saturation and the opportunity is in catch-up growth.
Digital payments: China’s super-apps ( Alipay / WeChat Pay ) dominate, but India’s public, interoperable model of UPI (NPCI BHIM ) is unique. On both transaction count and merchant acceptance density, India now operates at global-scale daily volumes with near-zero MDR, a strong catalyst for digital commerce in low-ticket, high-frequency use cases.
Logistics cost curves: China’s coastal clusters and US interstate freight deliver scale benefits; India is closing the gap through dedicated freight corridors, highway upgrades and tech-led last-mile orchestration. Crucially, India’s labour-and-tech blended model supports ultra-fast fulfilment at costs viable for mass-market baskets.

The implication is that India is structurally earlier on the S-curve, but with world-class rails already in place. That combination of low penetration + high infrastructure readiness is what creates the multi-year compounding runway.

What this means for categories and cohorts

Grocery & essentials: Quick commerce’s climb from US$3–6 bn (2023–24) to US$35–40 bn by 2030E indicates that “planned convenience” (weekly top-ups, fresh and pharmacy) is now habitual.
Electronics & appliances: The online share is already high; same-day delivery plus checkout credit expands ticket sizes.
Fashion & beauty: D2C’s projected rise to US$267 bn by 2030E will be led by brands that win on fit, community and repeatability; return-rate discipline remains the key margin driver.
Travel & services: Search and booking are nearly entirely online; cross-sell of insurance and credit creates superior unit economics.
B2B and Kirana enablement: Digitised procurement and working-capital credit increase throughput of neighbourhood stores; many will double as local pickup and return nodes will lead to omnichannel by design.

Why is this net-positive for India’s domestic demand

The shift online is not a zero-sum duel with physical retail. It formalises spending, widens access for smaller sellers, and deepens financial inclusion by pulling households into digital payments, credit and savings. By 2030, with ~US$250–270 bn of online GMV and a US$2.2T+ total retail economy, India’s digital commerce will:

Lift tax-compliant turnover and credit access for MSMEs.
Create new profit pools in logistics, SaaS, fintech and creator ecosystems.
Improve consumer surplus via better prices, faster fulfilment and wider assortment.
Generate productivity gains that recycle into higher wages and consumption.

Bottom line: India combines the world’s most used data pipes, a public-good payments backbone, cost-effective logistics, near-universal smartphones, and rising incomes. That is why digital is becoming the default and why the ballooning volume of digital transactions will continue to power India’s domestic consumption story for years to come.

Author:
Biharilal Deora, Director @ Abakkus Asset Manager

Embedding Enterprise Risk into India’s Regulations

Posted on September 10, 2025September 17, 2025 by Auburn Solutions

When people hear the term “risk management,” they often associate it with financial markets, insurance, or corporate governance. In reality, risk is omnipresent — embedded in daily operations, decision-making, and strategic planning across every sector.

Recognizing this truth, India’s Directorate General of Civil Aviation (DGCA) has issued draft guidelines for implementing a Fatigue Risk Management System (FRMS) in airlines — an initiative that reflects how risk governance is expanding across sectors to protect people, operations, and public trust.

A Shift from from Compliance to Integrated Risk Governance
Historically, pilot fatigue was managed through prescriptive measures: fixed flight duty periods, mandated rest requirements, and strict duty-hour limits. While these measures created a baseline of protection, they often failed to account for evolving operational complexities such as cumulative fatigue, unpredictable delays, irregular disruptions, and the unique dynamics of each route or crew schedule.

FRMS represents a more sophisticated, performance-based approach. It uses data and science to monitor fatigue, assess risk in real time, and take early action to prevent incidents. Crucially, this shift reflects the essence of Enterprise Risk Management (ERM): integrating risk considerations into strategic and operational decision-making so that organizations can anticipate threats, capitalize on opportunities, and build resilience — going well beyond simple compliance

Risk Management Beyond Finance: Aviation as a Case Study
The implementation of FRMS demonstrates that risk management is not a financial function but an enterprise-wide discipline. Fatigue is not just a “crew welfare” issue — it is an operational risk with the potential to impact passenger safety, airline reputation, and financial performance.

The Institute of Risk Management (IRM), headquartered in the UK, established in 1986, is the world’s leading professional certifying body for Enterprise Risk Management (ERM) qualifications, training, and examinations. IRM has long advocated for such a holistic approach, where risks are assessed, prioritized, and mitigated across all functions. The DGCA’s FRMS guidelines illustrate this shift in practice: treating fatigue not as an isolated regulatory metric but as a strategic risk that must be governed with the same rigor as financial or cyber risks.

Embedding Risk Culture: Safety as a Core Value
IRM defines risk culture as the collective values and behaviors that shape how risk is perceived and acted upon. Successful FRMS implementation will depend on building a culture in which:

Crew members feel empowered to report fatigue truthfully, without fear of punitive action.
Management treats fatigue reports as a driver of continuous improvement rather than an operational
inconvenience.
Leadership consistently reinforces that safety is non-negotiable, even when weighed against commercial
pressures.

This mirrors IRM’s emphasis on the “tone at the top” and shared accountability — ensuring that risk awareness is embedded in daily decision-making rather than confined to manuals and compliance checklists.

Clarifying Risk Appetite: Balancing Safety and Operations
ERM also calls for clarity on risk appetite — the amount and type of risk an organization is prepared to
accept to achieve its objectives. For airlines, this means explicitly defining:

What levels of fatigue-related risk are tolerable?
When should schedules be restructured, or flights rescheduled, to protect crew alertness?
How should operational and commercial impacts be weighed against long-term safety outcomes?

By formalizing their risk appetite, airlines create decision-making clarity for crew schedulers, operations managers, and executives, ensuring consistency across the organization and reinforcing passenger safety as a strategic priority.

Risk Management Standards: Governance and Continuous Improvement
The DGCA’s draft guidelines call for formal documentation, clear approval from accountable managers, and ongoing monitoring — all of which reflect global risk management standards and IRM’s framework for embedding risk governance into organizational processes.

An FRMS is not a one-time compliance exercise; it is a living system that must evolve with operational data, integrate scientific insights, and improve through lessons learned. This continuous-improvement cycle is central to IRM’s approach: risk management is a dynamic capability that strengthens organizational resilience over time.

Implications for Airlines, Regulators, and Passengers

For airlines, implementing FRMS may require upfront investment in technology, training, and analytics.
However, the long-term benefits are substantial: fewer fatigue-related incidents, more resilient operations,
and enhanced stakeholder trust.
For regulators, FRMS represents a move toward performance-based oversight — encouraging innovation
and accountability rather than relying solely on prescriptive rules.
For passengers, it offers reassurance that their flight crew are well-rested and supported by scientifically
validated safety systems.

Aviation’s Journey Toward Risk Intelligence
India’s aviation industry is one of the fastest-growing globally, bringing both opportunity and complexity. The introduction of FRMS marks a step toward a risk-intelligent aviation ecosystem, where safety decisions are informed by data, foresight, and governance rather than simple rule adherence. This evolution mirrors trends in other industries, where organizations are embedding ERM into their strategies — not to eliminate risk, but to manage it intelligently, protect stakeholders, and create sustainable value.

Lessons for Every Sector
The DGCA’s FRMS guidelines offer more than a technical roadmap for airlines — they present a blueprint for modern risk governance. By aligning with IRM’s principles of Risk Culture, Risk Appetite, and Risk Management Standards, this initiative demonstrates how structured, enterprise-wide risk thinking can prevent incidents, strengthen resilience, and build public confidence.

Effective risk management is about making better-informed decisions under uncertainty. By institutionalizing FRMS, India’s aviation sector is not only enhancing flight safety but also modeling how other industries can embed ERM into their operations — turning risk from a compliance obligation into a source of strategic strength.

For professionals and students, the expanding scope of ERM means that developing risk management expertise can greatly enhance one’s ability to contribute to any industry. Regulators in India – from SEBI in finance to DGCA in aviation – are reinforcing the need for risk-resilient business environments and higher standards of governance. This has created demand for managers who not only understand their domain, but also understand how to integrate risk management into that domain. Educational initiatives are rising to meet this demand. For example, the National Institute of Securities Markets (NISM) and the Institute of Risk Management (IRM) India Affiliate, have jointly launched the Enterprise Risk and India Regulation Course (ERIRC), aimed at equipping professionals with a comprehensive understanding of ERM and regulatory compliance across sectors. Such courses cover key areas like risk policy, appetite, and culture, helping practitioners see the connections between, say, managing operational risks in an airline and complying with risk regulations in banking. By upskilling through structured ERM education, professionals. can better contribute to developing strong risk cultures in their organizations and drive risk- informed decision making.

Author:

Kosha Parekh, IRMCert, LLB

Director of Academics & Operations – IRM India Affiliate

The $2.78 Trillion Bond Market – Fuelling India’s Growth

Posted on September 8, 2025September 8, 2025 by Auburn Solutions

As India charts its course towards Viksit Bharat, by 2047, the sophistication and depth of its financial markets are paramount. In this journey, the Bond market is emerging from the shadows to take center stage. Once considered the exclusive domain of large institutions, it is now undergoing a profound transformation. The Indian Bond market has reached a significant milestone, expanding to approximately ₹238 lakh crores (US$ 2.78 trillion) as of March 31, 2025. As the Reserve Bank of India maintains a steady policy stance and encourages corporates to tap into capital markets, it is an opportune moment to analyze the forces propelling this expansion and the structural shifts reshaping our fixed-income landscape.

The Corporate Bond Market Progression

While the overall market demonstrated impressive growth, the Corporate Bond segment was a standout performer, acting as a powerful engine for this expansion. The Indian Corporate Bond market now stands at ₹53.64 lakh crores (US$ 627 billion), constituting 22.51% of the total bond market. This accelerated growth is not incidental; it is the result of progressive regulations by SEBI and a lot of other converging factors.i

- ‘Retailization’ through Online Bond Platforms (OBPPs): The emergence of SEBI-regulated Online Bond Platform Providers has been a game-changer. For decades, the corporate bond market was characterized by opacity, high minimum investment requirements, and information asymmetry, effectively barring retail participation. The introduction of OBPPs has dismantled these barriers and a retail investor can now invest starting at just ₹10,000. By enhancing transparency through real-time price discovery, simplifying access via user-friendly digital interfaces, and lowering investment thresholds, these platforms are accelerating the ‘retailization’ of corporate bonds, bringing a new and diverse investor base into the fold. This democratisation is fostering a more vibrant and liquid secondary market.
- A Favourable Macro Climate: The current macroeconomic environment has created a fertile ground for fixed-income investing. A moderating inflation trajectory and the widely anticipated cycle of declining interest rates have naturally shifted asset allocation preferences. Investors, facing persistent volatility in equity markets, are increasingly seeking the relative stability and predictable returns offered by Bonds. This is no longer just about capital preservation; it is a strategic move towards building a balanced portfolio. The demand for fixed-income securities has created strong momentum, which has been met by corporates eager to lock in funding at attractive rates.
- Capital Market Efficiencies for Corporate Issuers: We are observing a slower transmission of policy rate cuts within the traditional banking sector, as banks manage their net interest margins. This has made raising capital through the bond market a more lucrative and efficient proposition for corporates. The capital markets are far more responsive to policy signals, allowing well-rated companies to secure funding at more competitive rates and with greater speed than through conventional credit channels. This efficiency not only lowers the cost of capital for businesses, fuelling investment and expansion, but also reduces the concentration risk on the banking system.

Evolving Dynamics in Government Securities

India’s borrowing is shifting toward longer‑term bonds. The Centre has about ₹108 lakh crore of G‑Secs outstanding and states have around ₹63.15 lakh crore of State Development Loans (SDLs). Short‑term Treasury Bills are roughly ₹7.9 lakh crore. In plain terms, the government is locking in more long‑term money to cut refinancing risk and to fund projects that take years. The growth in SDLs shows states are using capital markets more directly, which builds accountability. For sizing the bond market, this means the long‑end investible universe is larger, trading in key benchmarks is improving, and the yield gap between Centre and states is now a central input when choosing bonds.

The Road Ahead

The outlook for the corporate bond market remains decidedly bullish. The core conditions that fueled last year’s growth are expected to persist. However, beyond these existing tailwinds, several future catalysts are poised to accelerate this growth trajectory even further.

The trend of retail participation shows no signs of slowing. According to a BSE report, the number of transactions in the retail segment grew by an exponential 327% last year, and this momentum has only accelerated in the current fiscal, a trend we have witnessed firsthand on our platform. This deepening of the market is crucial for its long-term health and vibrancy.

A pivotal moment for the Indian bond market will be its inclusion in major global bond indices. This development is expected to attract substantial passive inflows from foreign institutional investors, enhancing market liquidity and stability. More importantly, it will align our market infrastructure, trading practices, and regulatory standards with global best practices, further boosting international confidence.

Conclusion

In conclusion, the Indian bond market is in the midst of a profound structural evolution. It is transitioning from a wholesale-dominated market to a more inclusive and dynamic ecosystem. Driven by regulatory innovation, macroeconomic tailwinds, and the unstoppable force of retail participation, it is becoming a more transparent and accessible arena for both issuers and investors. The journey towards “a bond in every hand” is not just a slogan; it is a strategic imperative for building a resilient and self-sufficient economy. This transformation is well underway, strengthening India’s capital markets for a new era of growth and prosperity.

Author: Mr. Vishal Goenka, Co-Founder, IndiaBonds

Think in Decades, Not in Years: The Indian Investor’s Edge

Posted on September 4, 2025September 4, 2025 by Auburn Solutions

As investors, we often judge performance on monthly (MoM), Quarterly (QoQ) and year-on-year (YoY) statistics. It feels natural to look back at how our portfolio did in the immediate past including past 3,6,12 months. But wealth is not created in tidy annual snapshots. True compounding only reveals itself over decades.

For Indian investors, this lesson is even more relevant today. With the economy set to double in size over the next 5-7 years, the greatest rewards will accrue to those who can hold on through the noise and let time do the heavy lifting.

The Short-Term Trap

Markets in the short run swing wildly with headlines like elections, global oil prices, central bank commentary, geopolitical events, political instability, quarterly results. These movements often appear significant when viewed in isolation and would look very sudden, negative and often repetitive, but they rarely impact the long-term earnings power of India’s strongest companies.

Relying on YoY returns alone often leads to:

Knee-jerk reactions: Selling in panic during corrections or buying in greed at market peaks.
Over-trading: Constantly shuffling portfolios or portfolio managers in search of quick gains, eroding compounding.
Myopic focus: Missing the broader structural story unfolding over decades.

What the Long-Term Data Tells Us

Nifty 50 – odds improve with time

Over 10-year rolling periods, the Nifty 50 Total Return Index (TRI) has delivered an average CAGR of ~14-15%.
In nearly half of all 10-year windows, returns were above 15% CAGR.
The probability of positive returns approaches 100% once holding periods extend beyond 5 years.

Recoveries from crises

2008 Global Financial Crisis: Nifty 50 TRI fell about -64% from peak to bottom, but patient investors saw the index reclaim highs within a few years.
COVID-19 (2020): Nifty slipped nearly -38% in March 2020 but regained pre-COVID highs by November 2020 – a recovery in just 231 days.

Wealth multiplier over three decades

The Sensex moved from ~3,000 in 1995 to around 80,000 in 2025 – a 25× wealth multiplier even before dividends.
Since its inception (base 100 in 1979), Sensex has compounded at roughly 18.6% per annum, one of the strongest long-term returns globally.

The message is clear: Its Boring, but it works, the longer the horizon, the lesser the role of luck and the greater the power of fundamentals.

Why Decades Matter for India

India’s structural drivers are best understood over 10–20 year lenses:

Demographics: A median age of 28 ensures sustained consumption growth.
Digitalization: GST, UPI and digitalization are expanding the tax base and deepening credit.
Domestic consumption and Capex Cycle: Infrastructure, manufacturing, green energy – these are long-gestation investments and the shift from lower middle class to middle class will boost income and consumption.
Domestic flows: With SIP inflows now above ₹20,000 crore a month, Indian households are committing capital for decades, not years. The MF AUM totals around a third of total bank deposits, a trend worth noticing.

How to Separate Noise from Fundamentals

Follow earnings, not headlines. Like movies are all about Entertainment, Entertainment, and Entertainment. Returns are also all about Earnings, Earnings and Earnings. Quarterly surprises matter only if they alter long-term earnings growth.
Use rolling returns. Look at 10-year rolling outcomes, not one-year snapshots.
Stay disciplined. SIPs and systematic asset allocation reduce the urge to time the market. Keep investing and stay invested.
Think in decades. A bad year or even two is insignificant in a 30-year compounding journey. Think about getting a bad grade in a unit test in college vs. preparing for an ivy league college.

The Power of Compounding

₹10 lakh invested at 12% CAGR grows to:

₹31 lakh in 10 years
₹96 lakh in 20 years
₹3 crore in 30 years

The real magic happens in the second and third decade. That is when compounding turns exponential. The first decade is to test your patience, the second is to test your discipline and the third decade is to reward your patience.

Closing Thought

India’s story is not about quarters or even years – it is about decades. GDP will double, corporate earnings will multiply, and investors who stay the course will witness the true power of compounding. Compounding is no doubt the only lesson worth learning and no less than a wonder in the world of investing.

YoY returns may create headlines. But decadal returns create wealth. The patient investor, who filters noise and stays invested in India’s growth story, will be the real beneficiary.

Author: Mr. Biharilal Deora, Director Abakkus

A Brief Archaic Romance: High Tariffs and Their (Un)intended Consequences

Posted on August 21, 2025August 26, 2025 by Auburn Solutions

Student “Sir, what does constant tinkering of Tariffs lead to?”

Teacher “A Quirky History Lesson in Self-Inflicted Trade Wounds!”

Synopsis: If history has been a great teacher, then, what it shows is repeated meddling with tariff levels – even modest adjustments – has consistently backfired. It has inflicted sharper downturns in global trade and growth than any possible short-term protective benefit might justify.

In June 1930, the United States enacted the Smoot–Hawley Tariff Act, raising average import duties by about 20 percent atop a preexisting 40 percent burden. What followed was not a patriotic bulwark for American farmers, but a 66 percent collapse in world merchandise trade between 1929 and 1934, as 25 nations retaliated in kind and global commerce plunged into a dramatic free-fall.

Global tariff levels have shrunk to roughly 2.6 percent, as reported by the World Trade Organization (WTO), after decades of incremental tinkering and liberalization. That slender remainder of duty seems innocuous – until one recognizes that even these small rates can rock the global economy. Staring at 100+% tariffs, my mind is reminded of the idiom – from Titanic to Tugboat!

So what has been the Empirical Verdict? In short, small tariff hikes, big growth slumps!

Modern macroeconomic studies confirm a chilling causal link. An increase of 3.6 percentage points in applied tariffs—roughly a one-standard-deviation shock—leads to about a 0.4 percent reduction in GDP five years later, with effects compounding year after year. In an era when global GDP growth hovers near 3 percent, shaving off nearly half a percentage point is no trivial matter.

In a recent release, the International Monetary Fund (IMF) shed light that steep tariff volatility—characterized by abrupt hikes and the threat of further retaliation—inflicts an immediate drag on business confidence, stalling investment and dampening world growth projections by 0.8 percentage points.

What seems “strategic” seems sheer folly! The logic behind tariff tinkering is often “targeted protection”: shield this industry, trigger retaliation there, leverage negotiations elsewhere. Yet history shows such maneuvers rarely achieve their narrow goals. Let us be reminded of the Smoot–Hawley Act of 1930. Aimed at aiding agriculture, it ultimately devastated U.S. exports (down two-thirds to Europe by 1932) and plunged banks into insolvency. Recent U.S. moves, which prompted this column, propelled the effective tariff rate from under 3 percent to above 100 percent, the highest since the Great Depression. When it was 20 percent, short-term front-loading spiked trade volumes, but the rebound has proven illusory, sowing recessionary risks worldwide. There is the added danger of piecing out exemptions. These temporary carve-outs for key sectors merely shift uncertainty; once exemptions expire, global supply chains buckle under renewed duty burdens.

At the end of the day, triggered by policy uncertainty, firms delay investment stunting innovation and job creation. Then there is fragility in the global supply chain; forcing costly rerouting, inventory gluts, and idled capacity. From the home country perspective, (i.e. the one imposing tariffs), while some jobs might gain short-lived protection, the net effect erodes efficiency and consumer welfare, as tariffs inflate prices on imported inputs and final goods. Ultimately it will lead to deadweight losses. And what about the world? Well, you just sounded the global retaliation bugle! An eye for an eye, tariff hikes invite symmetrical reprisals. The more the world breaks out the tax wrenches, the more growth stalls.

This leads me to an Ironic Prescription: Stability Over Spikes

If our goal were to nurture sustained global trade and buoyant growth, history and data converge on a single prescription: minimize tariff tinkering. Constant adjustments, even if well-meaning, undermine the very market confidence and integration that generate prosperity. We encourage people to look at longer term horizons when it comes to personal financial planning; like retirement planning. In investment planning, we encourage people to come out of the short term trader mentality and embrace a logical and workable asset allocation that delivers over time. World leaders have to think in similar lines for the whole world! Empirical studies across fifty years and 150 countries
find that lower, predictable tariffs foster higher growth and productivity. The IMF went on record with adequate proof that removing or stabilizing tariff schedules can erase recession risks more effectively than occasional protectionist bursts. We all know that trade liberalization will lead to increased economic efficiency. A Cambridge University paper presented a pertinent point that I gleefully add to my prescription: Equitable Liberalization: This term implies a proactive and balanced approach to globalization. It recognizes that while trade liberalization offers potential economic benefits, some sectors or communities may face job displacement, wage pressure, or other negative
consequences. Equitable liberalization emphasizes the importance of accompanying trade reforms with measures that address these negative impacts and promote fair outcomes for all citizens.

I am THOR! Well, not really! Reinventing the tariff wheel every few years might feel like wielding a mighty policy hammer—but experience shows it’s usually just nailing the global economy’s coffin. A world trading system thrives not on protectionist jolts, but on the steady hum of low, predictable duties. In practice, the secret to winning at global trade is not constantly rewriting the rules, but leaving them alone. That, more than any highfalutin strategic tariff play, is the one change the data—and centuries of commerce – demand.

______________

Rajesh Krishnamoorthy is an Adjunct Faculty at the National Institute of Securities Markets (NISM) and an Independent Director. Views expressed here are personal opinions.

Author: Rajesh Krishnamoorthy, Adjunct Faculty NISM

Understanding the Difference Between Volatility and Risk for Smarter Investments

Posted on August 21, 2025August 21, 2025 by Auburn Solutions

Volatility ≠ Risk.

Investor in the securities market face a perplexing challenge: distinguishing between marketvolatility and investment risk. Mutual funds, for instance, are required to make a disclaimer that “Mutual Fund investments are subject to market risks. The NAV of the scheme may go up and down depending on factors and forces affecting the securities market.”

The terms “risk” and ‘volatility” are frequently used interchangeably, but in reality they represent two fundamentally different concepts. Volatility is the measure of price fluctuations, a statistical measure of how much an assets value deviates from its average. Risk, on the other hand, is the probability of a permanent loss of capital. Understanding the distinction between the two will be the cornerstone of a successful long term investment strategy.

Volatility is a natural and inevitable characteristic of any liquid market. The volatility of an asset is measured by the standard deviation of the asset. A large standard deviation for a stock or a mutual fund scheme NAV means that the price swings wildly, both on the upside and the downside. But that does not necessarily mean that you will lose money on your investment.

Risk, by contrast, is the potential for your investment to fail to meet your financial goal. Staying invested in a company whose fundamentals are deteriorating or a mutual fund scheme that is perpetually underperforming its benchmark could lead to a permanent decline in the value of your investment.

The last 10-years have seen fairly large volatility in the Indian equity markets. There was extreme volatility in the equity markets during the pandemic years between 2019 and 2021 and the average India VIX (which measures volatility in the Indian equity markets) reached levels of 25% in 2019-20. But in spite of volatility, as measured by the India VIX, averaging over 15% in the 2015-2025 period, the 10 year CAGR for the Nifty 50 was close to 11%. Extreme volatility did not lead to permanent losses for those who stayed invested.

Year	NSE Nifty 50 year end value	NSE Nifty 50 year end value
2014-15	8491.00	13.0
2015-16	7738.40	16.8
2016-17	9173.75	11.1
2017-18	10113.70	13.5
2018-19	11623.96	15.3
2019-20	8597.75	24.9
2020-21	14690.70	18.1
2021-22	17464.75	17.2
2022-23	17359.75	13.8
2023-24	22326.90	12.5
2024-25	23519.35	11.9
10 year CAGR/Average VIX	10.73%	15.3

Another often misunderstood measure of volatility is Beta. Beta is the volatility relative to the market. A stock or a mutual fund portfolio with Beta > 1 is more volatile than the market and a stock or mutual fund portfolio with Beta < 1 is less volatile than the market. Often investors have a misconception that high Beta stocks or mutual fund schemes are riskier due to their wider price swings relative to the market. However, in the long run, these stocks or portfolios have the potential to deliver higher returns. A low Beta stock or mutual fund portfolio, while seeming safer, may not participate in market rallies and could underperform over the long run. In fact, low volatility, which
many investors seek, can be a double edged sword as it may indicate the lack of significant drivers. The true risk lies in factors like poor corporate governance, unsustainable debt or the changing competitive landscape and not in the volatility of the stock price.

Confusing volatility with risk often leads investors to make emotional decisions such as selling during market downturns. Investors need to understand that volatility is merely a measure of price movement and that volatility is not the same as risk.

Author: Mr. Sashi Krishnan, Director NISM

Inflation down to 1.55%. Can you rest easy?

Posted on August 19, 2025August 26, 2025 by Auburn Solutions

Inflation is measured in a straight-jacketed manner. But for 144 crore Indians, a single number can have many meanings.

Joydeep Sen

You have heard that inflation reduces the purchasing power of money, which implies you require more money to buy the same amount of goods or services in future. This is an age-old truth and will remain true in future as well. Today, we will provide you with some food for thought on how to view inflation.

How is inflation measured?

To gauge inflation, we examine the data reported by the government. The most widely used gauge is consumer price inflation (CPI). Another metric is wholesale price inflation (WPI). We will discuss CPI, as the Reserve Bank of India uses it for policy formulation. The latest declared data is for July 2025, which is 1.55%. With the inflation rate having eased to only 1.55 %, does it mean you would inflate your expenses by a more benign number than you thought of earlier? Not really.

Let’s examine how inflation is measured and assess the relevance of the data. The rate of price increase is calculated for a defined basket of goods and services. The starting point of the series, which dates back many years to 2012, is set at 100. Over the years, as prices went on increasing, the value of the index increased as well. Currently, the index value is 194.2 in June 2025. Inflation is measured year on year: for example, for June 2025, the index is compared with that of June 2024, which was 190.2 and the outcome is 2.1%. The percentage increase in the index over the course of one year is what is announced, and we react to it.

There is a flaw in this method, followed not just in India but all over the world. In this year-on-year computation, the price level of the previous year has a significant impact on the inflation data. Intuitively, when we think of inflation, we think of an increase in current prices. That is, of course, relevant, but the price level of the previous year is as applicable in determining the outcome, e.g. 2.1 % in June 2025. This is known as the base effect, where the base (denominator in the equation) influences the data. If inflation was higher in the previous year, and consequently the inflation index was higher, inflation this year is that much lower. And vice versa.

The other issue is the composition of the basket. Almost half the CPI measurement basket comprises food or food-related items. This would be true for some people who are just above the subsistence level. People who are in a position to save and invest a chunk of their earnings would not need to spend as much on food. The broad issue is that there is only one basket for measurement nationwide. However, the consumption basket of all the 144 crore people of the country is different. It is not possible to have multiple baskets across the country; there are none anywhere in the world. Hence, the available inflation data is the nearest proxy for gauging and incorporating into your financial plans.

How should you measure?

Theoretically, you look at your consumption basket and measure inflation accordingly. However, it is practically difficult, near-impossible for individuals to do it consistently. One approach could be to consider the goal you are saving and investing for. If the goal is a child’s education abroad, that inflation would be different from the inflation of vegetables in India, a significant variable in the CPI basket. When considering a purchase, such as a house or a car, you can evaluate it accordingly. If you can gather working data on the item you are looking at, you are better off than looking at the generic CPI data of a government-decided basket.

Even with the available data, it is possible to avoid the base-effect flaw by looking at a longer period. As an example, the CPI index was 194.2 in June 2025; the data is available on the website pib.gov.in. Five years ago, in June 2020, it was 151.8 and ten years ago, it was 123.6. The compound annualised growth rate (CAGR) inflation over five years is 5.05% and over ten years is 4.6%.

Professional guidance

When formulating your financial plan, it is advisable to seek professional input. If you are doing it yourself, even if you are savvy, you may miss out on specific nuances. An experienced financial planner can guide you adroitly. You must ask your financial adviser the right questions, not only about the expected returns on your portfolio. In the current context, inflation can be managed in tandem with your planner. You can form a rough estimate of your consumption, e.g., X% on food, Y %on education, or Z% on discretionary consumption. Accordingly, you can discuss with your planner the basis for the assumed rate of inflation for your expenses five or ten years from now.

Inflation is not under your control. You need not fret over it or plan your consumption basket around it. You are earning, saving, and investing for a reason. Your finances should not go haywire due to deficient planning. Inflation is a cog in this wheel; put the best estimate in your Excel spreadsheet.

Published in Economic Times Wealth on 18 August 2025

Author: Joydeep Sen, Corporate Trainer, Author Columnist

Thinking like a Forensic professional to prevent risks from turning into a crisis

Posted on August 14, 2025August 18, 2025 by Auburn Solutions

Today’s business landscape is volatile and riddled with fraud risks emerging from rapid digitalization, lack of adequate control measures, and lax governance. Tech- savvy fraudsters exploit these loopholes to siphon off huge funds. From ﬁnancial crime, employment fraud, oversight errors, fraudulent transactions, asset misappropriation, money laundering, and terrorism ﬁnancing—fraudsters leverage advanced technologies to launch multipronged attacks that can cripple the organization and quickly escalate into full-blown crises. While organizations must ensure they are equipped to deal with fraud on a real-time basis to minimize damage and regain control, building resilience to fraud lies not just in reacting to threats, but proactively anticipating and neutralizing them even before they occur.

Forensic functions play a key role in helping organizations build frameworks that can withstand fraud incidents and prevent them from erupting in the first place. It is imperative for professionals to stay at the top of their game so that they can outsmart fraudsters who harness latest technologies to devise high-level frauds. While brushing up on the basics of compliance and keeping abreast of recent regulatory developments can help, they must develop an acumen for investigative work through rigorous training.

What does it take to be a Forensic professional?
Curiosity is an inherent trait, but it takes more than mere inquisitiveness to become a Forensic professional. The Forensic practice requires professionals that possess a unique blend of analytical acumen, legal insight, and technological fluency. Forensic professionals operate like investigators—decoding financial records to uncover hidden patterns, misconduct, or fraud. Training to develop critical thinking and thoroughness to sniff out a fraud is imperative to make a headway in the Forensic field. Continuous training at regular intervals can help sharpen the analytical bent of
mind to recognize early warning signs, understand the anatomy of risk, and build systems that detect anomalies before they become disasters. Essentially, professionals must learn to toe the line between measured scepticism and unfruitful cynicism to be able to make informed decisions. Over time, this will help them guide companies towards building a proactive fraud risk management practice, establish good governance principles, and automate compliance.

Developing a Forensic mind
Constant upskilling is a must for Forensic professionals. Getting acquainted with the latest technological advancements empowers them to detect red flags more effectively and respond with precision. It provides a competitive edge, enabling professionals to lead investigations with confidence and accuracy. Moreover, the ever-evolving regulatory environment demands ongoing learning to ensure that forensic investigations remain timely, compliant, and legally sound. Whether it’s mastering digital forensics, leveraging AI-driven analytics, or navigating

complex legal environments, training ensures professionals remain sharp and relevant. Regular engagement reviews, hands-on interviews, and structured learning sessions are integral to maintaining an edge. The Forensic practice thrives on adaptability, making lifelong learning the cornerstone of success in the field.

Mitigating risks, preventing crises
Every organization is aware of the sector-specific risks associated with their operations but when threats are underestimated, they can quickly spiral into a crisis—often with devastating consequences. Crisis management is not only costly, but also only a curative measure aimed at controlling the degree of damage incurred. Forensic-oriented thinking encourages organizations to look beyond surface-level indicators and delve into the root causes of threats, so that they can be nipped in the bud. Forensic experts play the multifaceted role as strategic advisors helping organizations anticipate vulnerabilities and respond before risks snowball into crises. This entails developing a framework that automates regulatory compliance at every level and strengthening fraud reporting mechanisms to encourage organization-wide participation in risk management efforts.

Leveraging technology as an ally
Till a few decades ago, Forensic professionals had to rely on manual methods to carry out investigations. These checks had room for error caused by human oversight or bias. With advanced technologies such as AI, GenAI, and Machine Learning, the Forensic practice is now equipped with an arsenal to fight fraud and enhance compliance. Tools like data analytics, digital forensics, document checking, background checks, are at the disposal of Forensic professionals to help identify irregularities, trace transactions, and uncover hidden motives. Learning to leverage these tech tools is a non-negotiable for the modern Forensic professional.

Click here to learn more about the Forensic Investigation Courses offered by NISM:

Forensic Investigation – Level 1 : https://online.nism.ac.in//module/Forensic%20Investigation-%20Level%201.html

Forensic Investigation – Level 2: https://online.nism.ac.in//module/Forensic%20Investigation-%20Level%202.html

Reimagining Urban Finance: Why Municipal Bonds Matter More Than Ever

Posted on August 11, 2025August 14, 2025 by Auburn Solutions

India’s urban transformation is accelerating—with over 600 million people projected to live in cities by 2036 and urban regions already contributing more than 63% of the country’s GDP, which by 2030 is expected to rise to 75%

Yet, the local bodies responsible for delivering this infrastructure—Urban Local Bodies (ULBs)—remain fiscally constrained. Most continue to depend heavily on state or central transfers, limiting their ability to plan long-term, capital-intensive projects. In this context, municipal bonds are no longer a niche innovation—they have emerged as a credible, structured, and scalable instrument to unlock infrastructure financing for Indian cities.

Municipal bonds are not new to India. The first was issued by Bengaluru in 1997, but the market remained dormant for two decades. A revival began post-2015, when SEBI notified its Issue and Listing of Municipal Debt Securities (ILDM) Regulations. Combined with reform-oriented programmes like AMRUT and the Smart Cities Mission, this regulatory foundation began attracting municipalities back to market. Today, SEBI’s sustained efforts are bearing fruit, with a growing number of ULBs discovering bonds as a strategic alternative to grant-dependency.

As of June 2025, 23 municipal bond issuances have been completed under SEBI’s framework, mobilising a cumulative ₹3,358.90 crore. The first quarter of FY2025 alone has seen a record ₹575 crore raised by six ULBs—Agra, Prayagraj, Varanasi, Greater Chennai Corporation, Pimpri-Chinchwad, and Gandhinagar and many more have queued up to tap the bond market this fiscal year.

Adding momentum, Suraj Municipal Corporation is preparing to launch a public issue of ₹200 crore (including a green shoe option)—a major step that will allow direct retail participation in India’s municipal bond market and expand its investor base. While most municipal bond issuances so far have been via private placements—favoured for their quicker execution, simpler compliance, and institutional targeting—there is a clear need to scale up public bond issuances to enable broader participation and deepen the investor base.

To further improve access to the bond market, SEBI has permitted privately placed bonds to carry a face value of ₹10,000, as an option, in line with public issues—subject to the appointment of a merchant banker.

A key reason for growing investor interest is the robust credit structuring seen in recent municipal bonds. Today’s bonds are typically backed by ring-fenced cash flows—such as property tax or user charges—deposited into escrow accounts. These are supported by additional security mechanisms like Debt Service Reserve Accounts (DSRA), Sinking Fund Accounts (SFA), and Interest Payment Accounts (IPA). This structured waterfall ensures prioritised debt servicing and has helped most issuances secure credit ratings in the AA or AA+ category, even when the underlying municipal finances remain modest.

The Ministry of Housing and Urban Affairs (MoHUA) has further strengthened the ecosystem through incentives under AMRUT 2.0. ULBs can receive ₹13 crore per ₹100 crore raised (up to ₹26 crore) as grant support. For those seeking a second round of incentives, the bond must qualify as a green bond under SEBI’s NCS framework—eligible for ₹10 crore per ₹100 crore raised (up to ₹20 crore), provided the funds are used for climate- aligned sectors like water, sanitation, renewable energy, or urban resilience. MoHUA has also extended this incentive to pooled municipal bonds, allowing smaller ULBs to aggregate their borrowing through state-level pooled finance entities.

Green and ESG-linked bonds are fast becoming the next frontier. Cities like Indore, Ghaziabad, and Pimpri-Chinchwad have issued green municipal bonds that were well received in the market—several being oversubscribed. These issuances are aligned with SEBI’s green debt security framework, which mandates use-of-proceeds tracking, external certification, and anti-greenwashing safeguards—bringing Indian muni bonds closer to international ESG standards.

In the early stages of this market’s evolution, the U.S. Treasury Department’s Office of Technical Assistance (OTA) played a catalytic role. Under a 2020 MoU with MoHUA, the OTA supported few Indian municipalities—including Pune and Vadodara—in building bond issuance capacity through financial modelling, structuring guidance, and investor preparation. One of the standout cases was Vadodara Municipal Corporation (VMC), which issued a ₹100 crore bond in 2022. It was oversubscribed ten times, and with AMRUT incentives factored in, brought the effective coupon down to 4.55%, which is an achievement, even much below the AAA rated bond issuers.

Vadodara’s success was rooted in strong governance. It had adopted accrual-based accounting, ensured timely audits, and clearly linked bond proceeds to defined infrastructure outcomes. Its example has become a reference point for other tier-2 cities aspiring to access bond markets effectively.

To help guide others, VMC also recently published a detailed case study booklet titled “The Green Book,” which documents their entire green bond issuance journey—challenges, structuring process, stakeholder coordination, and lessons learned. This resource now serves as a valuable reference for other municipalities exploring similar capital market access besides the SEBI Municipal Debt Securities – Repository web portal.

Despite this momentum, key challenges remain. A majority of ULBs are unrated or fall below investment grade. Revenue autonomy is weak, with most cities depending on transfers rather than generating their own income through property tax or user fees. Financial reporting remains inconsistent, with many cities yet to adopt the National Municipal Accounting Manual (NMAM).

Without a strong project pipeline backed by ring-fenced revenue flows, investor appetite remains cautious. The lack of a dedicated municipal insolvency framework also creates legal uncertainty for long-term bondholders. Moreover, India still lacks a deep secondary market for municipal debt, restricting exit options for investors.

Going forward, policy and institutional innovation will be essential. SEBI, MoHUA, credit rating agencies, and intermediaries should collaborate to develop tailored rating methodologies suited to pooled structures, green bonds, and hybrid guarantees. Tax rebate, if considered, could further broaden the investor base, especially among retail and HNI segments looking for stable, tax-efficient returns.

Multilateral development banks (MDBs), ESG-focused investors, and impact funds should also consider actively participating in India’s municipal bond space—especially where proceeds are earmarked for green and socially sustainable urban infrastructure. Their involvement could deepen market credibility, support capacity-building, and help unlock blended finance models in cities that need both capital and technical handholding.

India’s cities are at the heart of the country’s economic and demographic future. But the infrastructure they require cannot be financed through grants and subsidies alone. Municipal bonds—whether issued through public offerings or private placements—are emerging as a vital bridge between capital markets and urban development. When transparently structured and professionally managed, these instruments can instil fiscal discipline, unlock long-term funding, and enable cities to move from grant-dependency to true creditworthiness. As we reimagine urban finance, municipal bonds are no longer just an option—they are an essential pillar for building resilient, accountable, and investment-ready Indian cities.

Venkatakrishnan Srinivasan
Founder and Managing Partner
Rockfort Fincap LLP

Venkatakrishnan Srinivasan (Venkat) is a veteran of India’s bond market, with over 30 years of expertise in Indian Rupee Bonds and Debt Capital Markets. His career spans guiding debt transactions from origination through execution, consistently delivering successful outcomes.

Before founding Rockfort Fincap LLP in late 2021, Venkat served as Senior Vice President at ICICI Securities Primary Dealership Limited (I-Sec PD) until June 2021.

Author: Venkatakrishnan Srinivasan, Founder and Managing Partner, Rockfort Fincap LLP

Equity-linked Exchange Traded Derivative Contracts – The Retail Rush and Regulatory Measures

Posted on August 8, 2025August 8, 2025 by Auburn Solutions

Background

Derivatives are foundational instruments in modern financial markets, created to manage and transfer risk. By allowing participants to take positions on future price movements, derivatives such as futures and options enable efficient price discovery, portfolio hedging, and liquidity management. Globally, Institutional investors have long used these tools for risk control and asset allocation strategies.

In India, the Equity linked Exchange derivatives market has undergone a rapid transformation in recent years. It is now among the world’s largest by volume, thanks in part to a surge in retail participation and also due to the small size of the contracts (as compared to global counterparts). Aided by user-friendly platforms, low entry costs, and real-time digital access, retail investors are also entering the derivatives segment in record numbers, particularly trading Index options contracts. Weekly contracts on headline and sectoral indices like Nifty 50 / Sensex / Bank Nifty / Bankex had become the most actively traded products, often favoured for their affordability and flexibility as also for the high volatility associated with such underlying indices.

This trend marks a significant shift in the participant profile of India’s F&O market, from a space once dominated by Institutions and hedgers to one increasingly populated by retail traders. Understanding this shift is critical to evaluating how the market is evolving, the role derivative contracts now threaten to play in retail portfolios, and what it means for market structure and regulatory oversight going forward.

Overview of SEBI study on Retail Investors

Recognising this shift and its potential consequences, SEBI initiated a series of data-driven studies to assess the financial outcomes for retail participants in the Exchange traded derivatives segment. The first of these studies, released in January 2023, was a watershed moment. Titled “Analysis of Profit and Loss of Individual Traders Dealing in Equity F&O Segment,” the report revealed that a staggering 9 out of 10 retail traders ended up with net losses. This eye-opening data sparked widespread discussion and concern, leading SEBI to initiate a consultative process aimed at strengthening investor safeguards and market discipline.

In July 2025, SEBI published a follow-up study incorporating data from the financial year 2024–25. This is a more detailed and expansive analysis and presents the underlying picture of retail trading patterns. It highlighted not only the growing scale of participation but also the concentration of risk and losses.

Key Findings

Here are some of the key findings of the SEBI report of July 2025:

Massive Retail Losses in Derivatives:

In FY 2024-25, 91% of individual traders in the Equity Derivatives Segment (EDS) incurred net losses, similar to the previous financial year.
Net losses of retail traders widened to ₹1.05 lakh crore in FY 2024-25 (up 41% from ₹74,812 crore in FY 2023-24).
Average loss per trader in FY 2024-25: ₹1.1 lakh (up 27%).
The details of losses are as follows:

Source: SEBI

Weekly Index Options Dominated Retail Activity

Majority of the retail losses were concentrated in weekly index options contracts (e.g. Nifty 50, Sensex, Bank Nifty and Bankex).
The number of contracts in these instruments saw exponential volume growth but were largely used speculatively, not for hedging.

Participation Trends and Contraction

Unique retail traders in the Equity Index derivatives segment (EDS) dropped 20% YoY in the December 2024–May 2025 period.
Despite the decline in the above-mentioned 6-month period, the participation is still 24% higher than what was seen two years ago.
Traders with low turnover (<₹1 lakh) saw the sharpest decline, yet they represented the largest growth cohort over two years.

Derivative Turnover Trends

Index options (premium terms) grew at a 5-year CAGR of 72%; notional turnover was up 101%.
In FY 2024-25, average daily traded value in EDS was ₹2.63 lakh crore, while Cash Market was ₹1.2 lakh crore.

Source: SEBI

Recent SEBI Measures in Equity Derivatives Segment

In the light of rising retail participation and alarming levels of losses in the Equity derivatives segment, SEBI introduced a series of regulatory measures between late 2024 and mid-2025. These steps aim to curb excessive speculation, enhance risk management, and ensure more informed and sustainable participation by individual investors. Below is the list of some of the key measures taken by SEBI:

Rationalized weekly Index derivative contracts to reduce speculative expiry-day trading.
Increased tail risk coverage on expiry days to better manage volatility and systemic risk.
Raised the minimum contract sizes for Index derivatives to limit over-leveraging by low-capital traders.
Standardized expiry days across Exchanges to streamline derivative contract lifecycles.
Mandated upfront collection of Option premiums from buyers to enforce capital discipline.
Removed calendar spread margin benefits on expiry days to curb misuse of hedging strategies.
Introduced intraday monitoring of position limits to prevent real-time breaches and ensure compliance throughout the trading session.

The Way Forward

As India’s Equity derivatives market expands, the focus must shift toward ensuring responsible and informed participation. SEBI’s recent measures are a step in the right direction. Enhancing financial literacy is the need of the hour. The Exchanges (where such contracts are traded) must come forward and conduct targeted Investor programmes with the aid of Pin-code analysis (to get an idea of the trading pattern across the country). Introduction of risk-profiling before retail access (aligned with international best practices) is also an important step to be considered. Brokers and Exchanges must promote transparent disclosures and better risk awareness. A dynamic, data-driven regulatory approach should continue to guide market reforms. Striking a balance between Innovation and Investor protection will be key to building a more resilient and inclusive Equity derivatives ecosystem going forward. SEBI must continue to remain committed towards its key functions of ‘protecting the investors of securities and promote the development of and regulating the securities market’.