The Chatter: Reliance, Axis Bank, Tata Power, UltraTech Cement & More
Q1 FY27 | Edition #70
Welcome to the 70th edition of The Chatter — a weekly newsletter where we dig through what India’s biggest companies are saying and bring you the most interesting bits of insight, whether about the business, its sector, or the wider economy. We read every major Indian earnings call and listen to the interviews so you don’t have to.
We’re always eager to improve—please share your ideas on how else we can innovate “The Chatter” format to better serve your needs.
In this edition, we have covered 9 companies across 6 industries.
Energy
Reliance Industries
Tata Power
Financial Services
Axis Bank
Paytm
Can Fin Homes Limited
Building Materials
UltraTech Cements
Engineering & Capital Goods
Havells India Limited
Real Estate
Oberoi Realty
Chemicals
Rallis India
Oberoi Realty | Large Cap | Real Estate
Oberoi Realty is a premium real estate developer based in Mumbai with a presence in residential, commercial, and retail segments. The company is recognised for its industry-leading margins and focus on luxury developments in high-demand urban clusters.
[Concall]
Management argues that their superior profitability is a result of strategic project selection rather than limited scale. This suggests that the company can grow its sales volume without diluting its industry-leading profit margins.
“Margins are not strictly tied to sales volume; it is about how you strategize your product. It begins with how you buy the land, how you design the product, and how you approach the market. We are very confident that our margins will continue to hold going forward.”
— Mr. Oberoi, Chairman and Managing Director
A high-profile luxury residential project in Mumbai is scheduled for launch in the third quarter of the current fiscal year. This project represents a key catalyst for booking growth in the upcoming months.
“We are hoping for a Q3 FY27 launch for Adarsh Nagar. Previously, we mentioned it would be between Q2 and Q3. Given how our industry works, I always maintain a cushion of a quarter, but Q3 looks likely.”
— Mr. Oberoi, Chairman and Managing Director
Oberoi is actively scouting for large-scale land acquisition opportunities in the National Capital Region to replicate its successful Mumbai township model. Success in these new markets would significantly expand the company’s total addressable market.
“Business development is an everyday focus, now including both Noida and Gurugram. We receive many offers, but we are mindful of land and location. We want growing markets with land parcels large enough to monetize over time.”
— Mr. Oberoi, Chairman and Managing Director
The company is successfully implementing price hikes across its core portfolio without seeing a drop in buyer demand. Strong secondary market performance confirms the pricing power and brand value associated with their projects.
“We are proactive with pricing. In both Goregaon and Mulund, we increased prices, and the market has supported this. Resale apartments in our projects continue to sell at higher prices, and completed buildings are setting new benchmarks.”
— Mr. Oberoi, Chairman and Managing Director
Management believes the company’s construction management capabilities have matured to a level that can handle large-scale, complex projects simultaneously. This operational readiness supports a more aggressive strategy for geographical and volume expansion.
“We have reached a tipping point where we can confidently proceed into our next phase of expansion. We are currently constructing almost 18 towers that are 60-65 floors high at various stages.”
— Mr. Oberoi, Chairman and Managing Director
Can Fin Homes Ltd. | Mid Cap | Housing Finance
Can Fin Homes is a specialized housing finance company in India, primarily focused on providing housing loans to the salaried and self-employed segments. It operates as a subsidiary of Canara Bank and maintains a robust presence across various Indian states with a focus on retail home loans.
[Concall]
The company exceeded its lending targets for the first quarter due to strong demand across all its operating regions. This performance demonstrates a healthy appetite for home loans despite broader economic uncertainties.
“Against the 2,500 crores planned and projected for Q1, we have achieved 2,609 crores. We have been able to exceed our original projections. This was possible due to positive growth across all our geographies.”
— Suresh Iyer, MD and CEO
Management is facing higher-than-expected loan repayments as customers shift their debt to other lenders or pay off balances. This trend forces the company to increase its new loan originations just to maintain the overall size of its portfolio.
“The challenge, however, has been that prepayments or run-downs have been slightly higher compared to Q4 of last year. One of our expectations was that after the conversion from an annual to a quarterly reset, we might see a reduction in BT (Business Transfer) outs. However, this has not happened.”
— Suresh Iyer, MD and CEO
Bad loan levels have been consistently falling for over a year, indicating very high asset quality. Management expects credit-related losses to remain extremely low, which protects the company’s bottom line.
“For the last six quarters, our NPL ratios have been decreasing, and we don’t see an increase in delinquent accounts. We are confident we can maintain our credit cost guidance of 10 basis points.”
— Suresh Iyer, MD and CEO
A major upgrade to the company’s technology systems has successfully moved past the testing phase and is now operational in several branches. This modernization is critical for improving efficiency and the speed of loan processing.
“We did a pilot in 5 branches. There were some teething problems, but nothing that impacted business. We implemented all of them on July 8. It has been 12 days, and all five branches have processed all transactions, including sanctions, disbursements, customer creation, NACH processing, and EMI collections.”
— Suresh Iyer, MD and CEO
The company charges slightly higher interest to self-employed borrowers because they carry a higher risk of default. This higher interest rate more than makes up for the increased risk, making this segment a profitable part of the portfolio.
“The ROI for self-employed is about 0.5% higher than salaried housing. The GNPA for salaried is around 0.63%, while SCNP is around 1.5%. Factoring in the yield, the 0.5% spread makes it yield-accretive.”
— Suresh Iyer, MD and CEO
Axis Bank | Large Cap | Private Sector Bank
Axis Bank is one of India’s largest private sector banks, offering a diverse range of financial services across retail, corporate, and SME banking segments. The bank operates under its GPS (Growth, Profitability, and Sustainability) strategy to drive market share gains and operational efficiency through digital transformation.
[Concall]
The bank is centralizing its artificial intelligence initiatives through a new enterprise platform to drive long-term scalability. This structural tech investment is intended to lower future development costs and improve the speed of deploying digital innovations.
“Axium, our enterprise AI offering, is designed to systematically embed AI in the functioning of the bank by adopting a capability platform-led approach. The core idea is simple: build capabilities once, govern them centrally, and deploy them many times across the enterprise. This will enable us to create reusable AI assets that can be leveraged across businesses, functions, products, and customer journeys, guaranteeing consistency, speed, and scale.”
— Amitabh Chaudhary, MD & CEO
Recent aggressive interest rate cuts combined with a shift toward lower-yielding corporate loans have significantly compressed the bank’s margins. This breakdown helps investors differentiate between temporary macroeconomic pressures and deliberate strategic changes in the loan portfolio.
“The year-on-year NIM decline of 34 basis points can be attributed to 19 basis points due to the full impact of the 125 basis point repo cut in the current quarter, versus a 25 basis point repo cut in the same quarter last year, net of the benefit from cost of funds due to liability repricing. Additionally, 16 basis points was due to the change in balance sheet mix over the last 12 months.”
— Puneet Sharma, CFO
The bank characterized its recent sharp growth in overseas lending as a tactical move to capture specific high-return opportunities. Investors should not expect this to signal a permanent shift in the bank’s long-term geographic or portfolio risk profile.
“Where we see opportunities that meet our internal thresholds and RAROC requirements, and offer reciprocal flows and fees, we participate. In this case, the opportunity was in foreign currency loans. This is opportunistic; there is no specific directional change in the long-term portfolio mix.”
— Puneet Sharma, CFO
The bank is moving forward with plans to increase its equity ownership in Max Life Insurance following clearer regulatory guidelines. A larger stake would deepen the bank’s integration with its insurance partner and potentially enhance long-term fee income.
“Regarding the Max Life stake, there is an opportunity based on RBI clarifications from December. We are evaluating this internally and will engage with the regulator once we have board approvals. We have always been keen on a higher stake.”
— Puneet Sharma, CFO
Reliance Industries | Large Cap | Energy
Reliance Industries is India’s largest private sector company with diverse operations in hydrocarbons, refining, petrochemicals, renewables, retail, and digital services. It leads in managing a fully integrated Oil-to-Chemicals portfolio and emphasizes inclusive growth by partnering with various stakeholders.
[Concall]
Management described the quarter as one of the most volatile in recent history, highlighting Reliance’s ability to navigate energy market disruptions while delivering strong financial performance.
“So, this has been an extraordinary quarter. Extraordinary when you look at it from point of view of macro volatility. Extraordinary if you see it from point of view of energy market shock. Extraordinary when you think of it in the context of what kind of supply chain dislocation that happened. And in that context is where when you look at the overall performance, I do want to say that it has been an extraordinary performance too. The kind of agility we have shown has been incredible.”
— V. Srikanth, CFO, Reliance Industries Limited
Management highlighted the growing contribution of its consumer-facing businesses, reflecting Reliance’s successful diversification beyond energy.
“Consumer businesses is now again back to, it is about 50% of the overall mix. Cash flows continue to be strong and are really funding the overall capex.”
— V. Srikanth, CFO, Reliance Industries Limited
Management explained that the strong O2C performance came despite windfall taxes, LPG diversion, refinery turnaround and supply chain disruptions.
“The whole challenge in this quarter was about getting the crude, given the kind of dislocation we saw in the Middle East... This performance is after providing for SAED, under-recoveries in retail, planned turnaround, LPG diversion and gas diversion. In that sense, what I said, it is extraordinary.”
— V. Srikanth, CFO, Reliance Industries Limited
Management explained how Reliance’s feedstock flexibility created a major competitive advantage during the oil price shock.
“You always talked about the benefits of ethane cracking and when you see it in this quarter, while oil prices were going up, actually ethane prices went down. Therefore, all the cracking that we do with the help of ethane, that was enormously valuable.”
— V. Srikanth, CFO, Reliance Industries Limited
Management clarified that lower retail margins are a deliberate investment to build digital commerce rather than a deterioration in the underlying business.
“This reduction is a conscious play. We are focusing on ramping up digital commerce across verticals. We want to build this digital business and create opportunities for the future.”
— V. Srikanth, CFO, Reliance Industries Limited
Management highlighted that digital services such as cloud, content and managed services continue to outpace the traditional telecom business.
“The digital services growth is 20% year-on-year, which outpaces the connectivity growth... We have been able to monetize services across content, cloud, IoT and managed services.”
— Anshuman Thakur, Head of Strategy, Jio Platforms
Management explained why Jio continues to aggressively push AirFiber as it significantly lowers deployment costs while accelerating customer additions.
“A lot of the growth is really coming through the AirFiber connectivity, and we are also encouraging that because the last mile becomes much more economical and time efficient.”
— Anshuman Thakur, Head of Strategy, Jio Platforms
Management highlighted the rapid growth in Jio’s intellectual property portfolio, reinforcing its transition into a technology innovator.
“We are the only Indian technology company to be in the global top 20 rankings... with almost 4,500 patents either awarded or under evaluation, clearly establishing our technology leadership.”
— Anshuman Thakur, Head of Strategy, Jio Platforms
Management highlighted how omni-channel customers spend substantially more than offline-only shoppers.
“Omni-channel customers have spent 2.7 times more than what a pure offline customer is spending.”
— Dinesh Taluja, CFO & Head of Corporate Development, Reliance Retail
Management highlighted the rapid adoption of its grocery platform and the acceleration in digital grocery demand.
“Grocery digital orders are up 116% on a year-on-year basis. Both the number of orders are increasing, as well as the average order values.”
— Dinesh Taluja, CFO & Head of Corporate Development, Reliance Retail
Management clarified that Reliance will not pursue growth at any cost in quick commerce and will expand only where economics are attractive.
“We will be quite disciplined... We will not chase volume growth or some vanity metric on number of orders.”
— Dinesh Taluja, CFO & Head of Corporate Development, Reliance Retail
Management explained why it believes Reliance is structurally better positioned than peers in digital commerce.
“We have transaction data over the last 20 years... supplier relationships... better terms of trade... and we are able to leverage our existing infrastructure. These are three or four things which will help us differentiate ourselves.”
— Dinesh Taluja, CFO & Head of Corporate Development, Reliance Retail
Management highlighted the scale of Reliance Consumer Products’ distribution network as it continues to strengthen its national presence.
“We have now more than 5,000 distributors, and we reach more than 3 million retail outlets. More than 80% of our sales is through external channels.”
— Ketan Mody, Executive Director, Reliance Consumer Products Limited
Management explained that although benchmark cracks surged, the business also had to absorb significantly higher crude premiums, freight and insurance costs.
“The product margins look like an astronomical growth, but it may not really reflect into the profit because there are certain headwinds like crude flat price, huge premiums, freight rates and insurance costs. Those are the kinds of costs which have risen sharply.”
— Srinivas Tuttagunta, COO – Refining & Marketing, Reliance Industries Limited
Management highlighted Reliance’s operational resilience by sustaining refinery throughput while many global refiners reduced production.
“The rest of Asia had runs which were down by maybe 15% to 20% during this crisis, whereas Reliance has been able to maintain a very high throughput, almost 96% to 97%.”
— Srinivas Tuttagunta, COO – Refining & Marketing, Reliance Industries Limited
Management explained that Reliance’s high ethane-based feedstock mix significantly improved its competitiveness during the quarter.
“For us, almost 70% of the ethylene feed is ethane. We were significantly in an advantaged position for the business.”
— Amit Chaturvedi, President – Petrochemicals, Reliance Industries Limited
Management clarified that ARPU growth is being driven organically through customer mix and usage rather than tariff increases.
“On a purely organic basis, without tariff action, we have been having a 4-5% ARPU improvement.”
— Anshuman Thakur, Head of Strategy, Jio Platforms
Management highlighted the scale of its battery manufacturing plans and the strategic importance of energy storage.
“We will achieve 40 GWh capacity this year... and scale up to 120 GWh, effectively positioning us as one of the largest globally.”
— Karan Suri, Senior Vice President – New Energy, Reliance Industries Limited
UltraTech Cement | Large Cap | Building Materials
UltraTech Cement, part of the Aditya Birla Group, is a leading manufacturer of grey cement, ready mix concrete, and white cement in India. It is the third largest cement producer globally, operating in UAE, Bahrain, Sri Lanka, and India. UltraTech’s Building Products business offers innovative solutions for modern construction projects under the brand Birla White.
[Concall]
Management said strong demand across infrastructure, housing and urban real estate remains the foundation for UltraTech’s growth outlook.
“One big theme for us, quarter after quarter, is demand. If demand is good, everything falls in line, and I am delighted to report that the first quarter of fiscal 2027 has reaffirmed that conviction emphatically.”
— Atul Daga, CFO, UltraTech Cement
Management acknowledged slower core-sector growth and modest state capex but does not see these as signs of a structural demand slowdown.
“Core sector growth slowed down in May, lower coal and refinery output, and aggregate state capex in April and May growing a modest 2% year-on-year. These are, I believe, timing effects and not any change in trends.”
— Atul Daga, CFO, UltraTech Cement
Management highlighted ports, shipyards, rail corridors, metros and data centres as highly cement-intensive sectors that should drive future consumption.
“Ports, shipyards and data centres are among the most cement-intensive asset classes in the economy. India’s capex revival is also being propelled by power and data centres, both concrete-hungry sectors.”
— Atul Daga, CFO, UltraTech Cement
Management expects premium housing, redevelopment, offices and hotels to sustain cement demand as urban India expands.
“Premium housing, redevelopment, office towers and hotels show urban India building upwards and outwards simultaneously, and every square foot of it is built on cement. That gives us confidence for cement demand growth.”
— Atul Daga, CFO, UltraTech Cement
Management highlighted record first-quarter performance across all major financial and operating metrics.
“Q1 was the highest-ever first-quarter performance for UltraTech across volumes, revenues, EBITDA and profit.”
— Atul Daga, CFO, UltraTech Cement
Management said customers previously buying acquired brands have shifted to UltraTech without a loss of volumes.
“Our team has been successful in converting customers who were buying a B or C category brand of cement into an A category brand of cement, willing to pay a price premium.”
— Atul Daga, CFO, UltraTech Cement
The company believes its 13.1% domestic grey cement growth will be well ahead of the industry.
“Our domestic grey cement volume growth of 13.1% will be well ahead of industry growth, translating directly into market-share gains.”
— Atul Daga, CFO, UltraTech Cement
Management expects better performance from acquired assets and newly commissioned capacity to lift unit profitability through FY27 and FY28.
“The improvement in acquired assets and capex-led cash flows through the P&L over fiscal 2027 and 2028 will result in the per-ton EBITDA trajectory moving sustainably upwards.”
— Atul Daga, CFO, UltraTech Cement
Management expects pricing to hold up despite seasonal weakness because higher costs are yet to be fully passed through.
“Industry expects prices to hold broadly steady through the monsoon quarter due to the impact of increased costs, which, frankly, is a constructive outcome for this time of year.”
— Atul Daga, CFO, UltraTech Cement
Management explained why individual home builders continue to value quality and trust over the lowest price.
“I believe cement is not just a commodity purchase. The customer does not shop for the cheapest bag; they reach for the brand they trust and the quality they can stake their family’s future on. That is the premium and why it endures.”
— Atul Daga, CFO, UltraTech Cement
Management compared India’s urbanisation level with other emerging economies to underline the long-term cement opportunity.
“As India urbanises, we will reach about 39% by 2030. This compares to countries like Indonesia, which are already 59% urbanised. There is a long way to go for construction, development and urbanisation.”
— Atul Daga, CFO, UltraTech Cement
Management said green power, alternative fuels and lower lead distances enabled UltraTech to absorb the West Asia-related cost shock better than peers.
“Our green power capacity of 1,897 megawatts met about 47% of our total power requirements at the end of this quarter. We absorbed the shock better than any peer, and we will harvest relief faster than any peer.”
— Atul Daga, CFO, UltraTech Cement
Management outlined a ₹17,000 crore expansion programme that will take consolidated capacity beyond 242 million tonnes.
“Projects under execution for capacity growth are backed by a capex of about ₹17,000 crores in the next two to two-and-a-half years, which will take our consolidated capacity beyond 242 million tonnes.”
— Atul Daga, CFO, UltraTech Cement
Management said raw-material availability will not constrain the company’s announced capacity growth.
“Every tonne of committed expansion at UltraTech is fully backed by secured limestone. There is no raw-material constraint anywhere on this growth trajectory.”
— Atul Daga, CFO, UltraTech Cement
UltraTech expects to finance its expansion and cost-reduction initiatives through internal accruals while keeping leverage under control.
“All these growth capex and cost-improvement initiatives are being funded with internal accruals. We are confident that this year will also end with net debt to EBITDA below 1x.”
— Atul Daga, CFO, UltraTech Cement
Management attributed the company’s pricing and market-share gains to its nationwide manufacturing, warehousing and distribution network.
“With almost 76 operating facilities spread across the country, we are within reach of the customer with a network of nearly 2,000 warehouses and 150,000 channel partners across the country. All these things put together bring a power that is unique to UltraTech.”
— Atul Daga, CFO, UltraTech Cement
Management guided for sequential cost pressure in the monsoon quarter due to fuel, maintenance and operating deleverage.
“I would expect costs to go up by ₹130 to ₹140 per tonne, all put together. I am looking at it all-in, including maintenance costs, operating deleverage and fuel costs.”
— Atul Daga, CFO, UltraTech Cement
Management expects policy changes and post-election activity to produce a structural improvement in eastern India’s cement demand.
“The structural change will be visible over the next two to four years. The East will witness a good demand upside cycle.”
— Atul Daga, CFO, UltraTech Cement
Management gave a clear full-year volume-growth ambition despite monsoon seasonality and elevated costs.
“Yes, we are targeting double-digit volume growth this year.”
— Atul Daga, CFO, UltraTech Cement
Paytm | Mid Cap | Financial Services
One 97 Communications, operating as Paytm, is a diversified fintech and digital services company. In payment and financial services, it provides payment facilitator services, consumer and merchant lending facilitation, and wealth management solutions. Its marketing services division operates as a digital products aggregator, offers ticketing services, and provides voice and messaging platforms to telecom operators and enterprise customers, along with various other digital business services.
[Concall]
Management explained that Paytm’s philosophy has shifted from chasing market share to acquiring only customers that generate sustainable profitability, allowing the company to grow while expanding margins.
“The best part is that we have learned our art of building the business where you can see how to make a profitable and growing business, and we have been able to pull that up very well. Going forward, as you would have seen, we have had our profitability increase. I believe that we should be able to increase our profitability further in consequent quarters, right away onwards, and then obviously the revenue growth will mean larger profit.
I am saying it because we basically learned that you should not recklessly spend money on acquiring consumers or acquiring merchants if they are not monetizable. So, we have been able to grow the market share with the discipline that we want the selective customer. We just don’t want market share for the sake of it. We want monetization, and consumer monetization is something that we are very proud of.”
— Vijay Shekhar Sharma, Founder & CEO
Management revealed that AI is evolving from an internal productivity tool into an independent business opportunity that could begin contributing meaningful revenue over the next few quarters.
“Beyond that comes the most important and consequent technology of our time, and that is AI. So, I am currently working on business and revenue line items that are non-payment and non-financial services. I fundamentally believe that moving ahead on the optimization journey, we will start to see our revenue monetization journey of AI.
I am extraordinarily happy that some of our products have started showing a few lakhs of revenue, but it is important to know that a couple of quarters later—I wish less than a year—I will be able to speak about this line item which will go into commerce cloud, the traditional marketing cloud business that we used to have in that line item. These are the two line items that I am personally focused on.”
— Vijay Shekhar Sharma, Founder & CEO
Management indicated that the company’s long-term profitability potential is materially higher than its current medium-term guidance, although future investment opportunities could influence the ultimate margin profile.
“We aren’t giving a number for that right now because, as you know, it is a tradeoff between just pursuing more growth and building an even larger business, which we absolutely think we have an opportunity to do in the areas that we mentioned. That will require investments. But structural margins for our business are significantly higher than the 15–20% which we have said we will achieve in the near term.”
— Madhur Deora, President & Group CFO
Vijay reinforced that Paytm’s current profitability is only the beginning and that management expects both earnings and margins to continue improving over time.
“We probably announced 8% of the margin this quarter. This is a ramp up from here. It has to grow forward and forward. I know you are seeking a terminal number and Madhur is saying that it is more than 15–16%. So, the direction is that we are talking about higher profitability and higher profit both together while we are on these numbers.”
— Vijay Shekhar Sharma, Founder & CEO
Management said the current acceleration in revenue is broad-based, with virtually every business segment contributing to growth rather than relying on a single product or vertical.
“I think the great thing about this growth that we are seeing is that it is in nearly every business. So, we are seeing that in our payments to small merchants, payments to large merchants, consumer payments that you mentioned, and we are seeing that in financial services. We are also seeing some of the smaller businesses growing very fast. You mentioned postpaid, which is a good example of that. So, we are seeing that pretty much across the board, and we think having achieved this number, we should aim for even higher.”
— Madhur Deora, President & Group CFO
Management believes Paytm Postpaid is scaling considerably faster than during its previous growth cycle, supported by strong customer adoption and product-market fit.
“The market opportunity is massive. The customer love and product-market fit for this product is excellent. It is really serving a need and there’s no reason why this journey should be any different. The only thing that I would add to that is that it took us about 4.5 or 5 years last time to get to those numbers. Currently, we are tracking roughly twice as fast. I am not saying that if it took us 5 years last time, it will take us 2.5 years specifically, but currently we are tracking twice as fast as you would expect in terms of ramping up this product. This product is ramping up with old users, new users, and everyone just really well.”
— Vijay Shekhar Sharma, Founder & CEO
Management described cash as one of Paytm’s biggest competitive advantages, emphasizing strong free cash flow generation and a disciplined approach to capital allocation.
“Cash is spine and strength. I wish that we have ₹40,000 crore cash eventually.
Compared to when this discussion started a year ago, not only do we have the ₹13,500 crores of cash, we are now also adding a significant amount of cash. So, I love the fact that we are a free cash flow generating business.
While we are adding cash to our balance sheet, we are also very actively looking within the existing perimeter of what we do for good ROI ideas... We are continuously looking for more opportunities within the business, mostly organic, maybe a few inorganic if there’s the right opportunity at the right valuation.”
— Vijay Shekhar Sharma, Founder & CEO
Management explained that merchant lending continues to be the biggest contributor to Paytm’s financial services profits, while the consumer lending business is recovering strongly without taking balance sheet risk.
“First of all, Sachin, I would say most of our profit is made from the merchant side. On the consumer side, we are driving growth; we have now grown quarter-on-quarter and reached year-on-year numbers that were flat or declining and have significantly ramped up. We have crossed January 2024 numbers even for consumer credit. But the intent here is that we have done all of it mostly without requiring any FLDG. We are essentially the distribution on the consumer side. But at the same time, the percentage split would be roughly 80-20 towards the merchant side. Quality is good, and that is why it is growing.”
— Vijay Shekhar Sharma, Founder & CEO
Management said capital availability is no longer a bottleneck for the lending business, with multiple banking partners providing significantly more funding capacity than current loan disbursements require.
“We have lined up small finance banks and I would say even the large banks are there now. A couple of large banks have been activated. So, on the partner side, we have more capital—probably four to six times more capital than we are disbursing right now. So, that is not a limiting factor.
Regarding the percentage between wealth and lending, when I say this is my focus area, it means I am trying to rejuvenate it to a sizable number. Wealth is not a material number compared to these other two numbers right now, but it is sizable enough that it shows up as a subsidiary, so people are able to see the P&L of that entity.”
— Vijay Shekhar Sharma, Founder & CEO
Management highlighted the significant expansion of its lending ecosystem, saying both merchant and consumer lending now have sufficient partners to support long-term growth.
“I just wanted to add one quick thing about the number of lending partners. I want to take this opportunity to say that this has been a key achievement last year. In both merchant loans and personal loans, we now have a double-digit number of partners. The partners who have joined more recently are also ramping up very well. So, we have really good legs for the next several years.”
— Madhur Deora, President & Group CFO
Management explained that margin expansion will be driven by a combination of revenue growth, operating leverage and AI-led efficiencies, while continuing to invest aggressively in growth initiatives.
“It’s actually all of those points. At the core of it, we have a very fast-growing business with huge opportunities to expand, for example, the penetration of financial services, not to mention improving unit economics of the payments business. So, we have a very fast-growing top line and our indirect cost structurally provides operating leverage. AI makes it even better.
What you would see is that indirect expenses as a percentage of revenue is going down because indirect expenses are growing at a very slow pace whereas revenue is growing at a very fast pace. I should mention that we continue to invest in areas that matter. The cost of people has increased year-over-year. That does not mean we are not investing.”
— Madhur Deora, President & Group CFO
Vijay explained why Paytm’s biggest competitive advantage in the AI era is not the model itself, but its distribution network and ability to monetize a large customer base.
“Basically, AI is a distribution business. Let me use a metaphor for my learning of the AI business. When you have your financial services business powered by AI, the differentiation will be how many customers you have and what you do with them—the monetization ability. These are the factors that multiply once you add the power of AI.
So, the qualifying condition for harnessing the power of AI is the distribution you are sitting on because nearly everybody could build what you build after some time. We will aggressively continue to invest in consumer expansion, merchant expansion, and the expansion of financial services. Being powered by AI means those costs are dramatically optimized.”
— Vijay Shekhar Sharma, Founder & CEO
Management shared one of the clearest examples of AI improving internal productivity, with merchant acquisition now increasingly driven by proprietary AI agents.
“I created a slide where I mentioned that our merchant distribution—the small business merchant acquisition—is now governed by an agent where the system identifies what a sales executive must do. This was all made in-house. I have started to find use cases for this going to third-party customers as well.
So now you are seeing that, if you do not look at the cost of sales people or marketing expense, the organization is flat or reducing costs quarter-on-quarter. There is no special quarter where we are trying to do this; the trend is continuing. What we are saying is that there is a growth of revenue that is starting to show from Q1 of this financial year onward. You are going to see this revenue ramp up and that is why we are talking about margin growth.”
— Vijay Shekhar Sharma, Founder & CEO
Management reiterated that Paytm’s business model is not dependent on UPI incentives or MDR, making any future UPI monetization a pure upside.
“Sachin, we serve small merchants as well, and we have materially large numbers of small merchants, and large enterprises including online merchants. Regarding UPI MDR, we have only one line: whoever pays, it is good; whoever does not pay, it is also good. We have monetized across everyone. So, our lives will not change materially.
Whatever comes in will go straight to the bottom line, and that will be a good thing. The point is that there is no obligation in our business model for this—neither the obligation for PIDF, nor UPI incentives, nor the expectation or need for MDR. Whatever comes will go to the bottom line. Therefore, let’s discuss it excluding that factor.”
— Vijay Shekhar Sharma, Founder & CEO
Management explained why Paytm is willing to discount merchant subscription rentals for high-value merchants, as the economics of financial services are significantly more attractive than subscription revenue.
“It is exactly the opposite. If we are creating a larger revenue item from a merchant, and if someone comes and offers them a cheaper subscription, we just remove that point from the discussion. Our money is made much more significantly in financial services. Since we make more revenue there, we consider the subscription non-material and we offer it at a discount so that no one else can offer a better commercial value differentiation during merchant sign-up.”
— Vijay Shekhar Sharma, Founder & CEO
Management said Paytm’s consumer payments business is benefiting from higher engagement rather than one-time user additions, with existing users transacting more frequently and strengthening the ecosystem.
“What is encouraging for us is not just the increase in the number of users but the increase in engagement. We are seeing customers transact more frequently on the platform, and that gives us confidence that our ecosystem is becoming stronger. As engagement improves, the opportunities to monetize through financial services, commerce and other products also increase. Our objective is to build deeper relationships with users rather than simply adding users.”
— Vijay Shekhar Sharma, Founder & CEO
Management explained that payments remain the foundation of the entire Paytm ecosystem, enabling monetization opportunities across lending, wealth, commerce and AI-driven products.
“Payments remain our distribution engine. Every additional consumer and every additional merchant strengthens our ability to cross-sell financial services and other products. We continue to believe that if we build the largest and most engaged payments network, monetization opportunities across lending, wealth, commerce and AI naturally become much larger. That is why we continue investing aggressively in payments.”
— Vijay Shekhar Sharma, Founder & CEO
Management highlighted that merchant acquisition is no longer evaluated only on subscription revenues, but on the merchant’s lifetime value across multiple product offerings.
“We do not evaluate a merchant relationship based only on subscription revenue anymore. We look at the total lifetime value of the merchant. Payments, devices, loans, settlement products and future financial services together create significantly higher value than any individual product. That changes the way we think about merchant acquisition and merchant retention.”
— Vijay Shekhar Sharma, Founder & CEO
Management emphasized that financial services remains in the early stages of penetration, giving the company a long runway for growth across merchant and consumer products.
“Financial services penetration across our merchant and consumer base is still relatively low. That means the opportunity ahead is substantially larger than what we have achieved so far. As our payments ecosystem continues to expand and customer engagement increases, we believe financial services will remain one of the biggest growth drivers for the company.”
— Madhur Deora, President & Group CFO
Rallis India | Small Cap | Chemicals
Rallis India Limited, a subsidiary of Tata Chemicals Limited, is part of Tata Group, operating in Agri-Sciences. The company provides farmers with innovative agricultural products, focusing on enhancing farm yield, soil health, and farmers’ income. It offers a wide range of crop protection, crop nutrition, and pesticide solutions domestically, while internationally engages in technical grade pesticides, formulations, and contract manufacturing.
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Management highlighted that the export business remains highly competitive, particularly in generic catalog products where Chinese manufacturers continue to exert pricing pressure, while the contract manufacturing (CSM) business remains structurally more resilient.
“Export is challenging unless you have a branded business in the countries where you operate. Regarding CSM, where you have a contract with the company, I think it is still fine because you can negotiate terms and conditions with the counterparty. For catalog products, we have to remain competitive. One product where we faced significant challenges is Acephate because raw materials come from China, and we have to process, pack, and sell it to countries like Brazil and the US, where China also competes directly. Other than that, we are quite competitive; we can compete with China, and it only depends on the demand situation. On the CSM side, it is not a big challenge, but on the catalog category, the challenge becomes significant.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management acknowledged that cotton will likely remain flat this year because of lower acreage, delayed rainfall and illegal HTBT cotton, but outlined a strategy of shifting resources toward faster-growing crops like rice, maize and millet.
“Regarding cotton, everyone operating in the crop protection sector has stakes in it, both in crop protection and seeds. In seeds, we have already factored in that the cotton business is unlikely to grow this year. Two things have happened. We were heavy in the North, and the Punjab and Haryana cotton area saw a significant decline. In the South and Central regions, factors like lower rainfall and the spread of illegal HDBT cotton are playing a role. We are looking at a flattish year for cotton, but we are focusing heavily on rice, maize, and millet, where we launched several products recently. Focus has shifted to being more aggressive on these other crops for the current season. Cotton will remain important and I believe it will recover, as these types of rainfall situations do not happen every year.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management shared its assessment of the evolving monsoon situation, highlighting that while rainfall has been deficient, cropping activity is catching up and the overall outcome is likely to be far better than initially feared.
“El Niño is certainly a reality. The country has seen deficient rainfall, but roughly 50% of the area in the country is irrigated and has some source of water; only the other 50% is highly rainfall-dependent. While there was delayed sowing due to delayed rain, there has also been a catch-up. Most of our farmers are small-scale and are able to quickly plant their crops. The thing that changes is the crop shift. For example, the pulses area has gone up, but we know groundnut area in Saurashtra has gone down due to delayed rain. Cotton will be planted less, but rice seems to be on track. Maize is also being planted. Some coarse grains like Bajra in marginal areas in Rajasthan might be impacted. It is a mixed picture. Even in a worst-case scenario, 90–95% of the crop will get planted. Clarity is still emerging on farmer preferences. Soybean has been planted despite some seed challenges. If crops get established, farmers will try to protect them because commodity prices are firming up in anticipation of lower yields.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management cautioned that it is still too early to forecast industry volumes, as weather patterns can materially alter pesticide usage during the season.
“That is a difficult question to answer. If we assume an average of three sprays per season, and in 20–30% of the area one spray is missed due to weather, that average drops. However, if the remaining area gets sprayed more so farmers can protect their crops, we might come back to the same total number. It is very situational. There are years where rainfall has been low, but crop protection has done well. It is too early to predict; I could give a better picture in the middle of August.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management said further price hikes are unlikely during the season and emphasized that future growth will depend more on execution, market share gains and volume expansion than on pricing.
“The focus now must be primarily on being competitive. Price increases during mid-season are generally very difficult. Whatever price increases had to happen have already occurred. In some areas, we passed on the full cost increase, and in others, only partial or none. Overall, I think there will be a marginal positive impact from price, but the majority of growth must come from volume. That is where market share, dealer relationships, and stock positioning come into play. We have been more active in that area than we might have been in the past.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management said channel inventory has largely normalized, but evolving crop patterns are changing product demand, requiring greater agility in inventory planning and market execution.
“Channel inventory has normalized now. It was more worrisome a month ago. In crops like soybean, there is a shift; there is lesser demand for pre-emergence herbicides but more demand for post-emergence. Farmers will wait until the crop emerges before putting money into inputs. We have to be ready for those situational shifts.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management believes organized agrochemical companies could gain market share this year as smaller players grapple with working capital constraints and slower liquidity in the channel.
“This sector often suffers from oversupply. When there is slightly less supply, it helps companies improve return metrics. A larger challenge is money getting stuck in fertilizer. When the fertilizer deficit occurred due to the war, everyone stocked up, but liquidation was delayed due to the rain. This delayed the off-take of crop protection products and impacted cash flows.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management warned that while raw material prices had begun to normalize, the recent escalation in geopolitical tensions could once again increase procurement costs for the Rabi season.
“About a month ago, things looked like they were cooling down and prices were trending toward normal. However, developments over the last week have changed that. We have enough inventory for Kharif, so there is no panic, but as we start procurement for Rabi in August, we will see the impact. Solvents like cyclohexanone and C9 are linked to crude prices and fluctuate accordingly. If the war situation persists, people may have to pay higher prices for Rabi inputs.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management explained that the recent depreciation of the rupee has had a net positive impact on profitability because Rallis remains a net exporter despite importing part of its raw material requirements.
“It is a double-edged sword because while we pay more for raw materials in dollars, we are a net exporter, so the net effect is positive. It has added to our profitability even with lower export volumes. Competition with Chinese players is product-specific, but generally, the currency situation has not made our position any worse compared to other Indian players.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management expects improving fundamentals in chilli and sugarcane to support crop protection demand during the second and third quarters.
“Chili is an important contributor to the crop protection industry. One of our products was impacted last year because commodity prices were low, but chili planting intentions are positive this year and prices are higher. Sugarcane depends on water, but as of now, the outlook is broadly positive. Improvement in chili should lead to positive sentiment in Q2 and Q3.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management believes lower cotton acreage alone may not materially hurt agrochemical demand if weather conditions allow farmers to carry out timely crop protection operations.
“A slightly smaller crop area with an open window for farmers to spray on the remaining 90% of acres can nullify the impact of a lower total crop area. A decent moisture environment might actually turn out to be more positive for field operations than we think at this stage.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management expects biologicals to become a faster-growing and structurally higher-margin business, supported by improving regulations and rising farmer adoption.
“Biologicals should do significantly better than last year. It is a smaller but more profitable segment. In Q1, it grew by 10%. As crop sowing picks up and farmers apply micronutrients and biostimulants, I expect this to pick up faster because there have been positive regulatory developments.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Management believes the current surplus in the seed industry should help the sector avoid supply shortages next year, while Rallis has proactively cut cotton seed production to avoid inventory build-up.
“In seeds, it is hard to predict. Industry had suffered for a few years due to shortages, but last year’s monsoon ending in September allowed for significant planting of seed crops. This year, the industry actually has a surplus of everything, which should help in managing the next season. We have taken proactive steps to reduce cotton seed production area this year because every company is carrying forward inventory.”
— Dr. Gyanendra Shukla, Managing Director & CEO
The CFO highlighted that working capital has temporarily increased because fertilizer purchases absorbed a significant portion of farmers’ liquidity, affecting spending on other agricultural inputs.
“Net working capital has increased by around 15–20 days. This is because farmers’ cash was blocked by early fertilizer purchases, leading to rationing for other agri-inputs. This is a common situation across the industry currently.”
— Bhaskar Swaminathan, Chief Financial Officer
Management explained that its early procurement strategy during the geopolitical disruptions helped secure inventory for Kharif, while maintaining flexibility between pricing and volume as the season progresses.
“We secured inventory for Kharif when the war started and prices were rising. It should have a positive impact. Price increases were not fully accepted by the market until June. We will try to strike a fine balance between volume and price, with priority given to volume if necessary.”
— Dr. Gyanendra Shukla, Managing Director & CEO
Tata Power Limited | Large Cap | Power
Tata Power is one of India’s largest integrated power companies, with businesses spanning conventional and renewable power generation, transmission, distribution, solar manufacturing, EV charging infrastructure, and clean energy solutions. The company is also expanding its energy storage portfolio to support India’s growing renewable energy ecosystem.
Tata Power has secured the first major government-backed bid for pumped hydro storage due to its advanced project readiness. This early success establishes the company as a leader in a new, high-growth segment of the energy market.
“This is our 1,000 MW Bhivpuri Pumped Hydro Project comprising three units of about 334 MW each. The first unit has been tied up through the SECI bid. This is the first large bid from a government entity, and we were successful because the project is already at a very advanced stage.”
— Praveer Sinha, CEO & Managing Director
Pumped hydro projects offer superior supply duration and much longer contract lives compared to other storage technologies. This structural advantage provides long-term visibility on cash flows while strengthening the economics of renewable power.
“Pumped storage has the advantage of providing around eight hours of supply every day throughout the year. It also has a much longer operating life, which is why this PPA has a tenure of 40 years. It offers certainty of supply and tariff.”
— Praveer Sinha, CEO & Managing Director
Integrating storage with renewable generation allows Tata Power to supply round-the-clock clean energy to utilities, industries, and data centres. This strengthens the company’s positioning in India’s evolving power market.
“Combined with solar and wind, pumped storage enables 24-hour clean energy for discoms, industries and data centres.”
— Praveer Sinha, CEO & Managing Director
Management believes pumped hydro and battery storage will complement each other rather than compete, with each serving different duration requirements across the grid.
“Battery energy storage systems can be deployed much faster, but they provide shorter-duration supply and have a useful life of around 10 to 12 years. The two technologies are complementary. BESS will be used where shorter-duration storage is sufficient, while pumped storage will serve longer-duration requirements.”
— Praveer Sinha, CEO & Managing Director
Tata Power is expanding its storage pipeline with another large pumped hydro project while positioning itself to benefit from India’s ambitious energy storage targets.
“Apart from the 1,000 MW Bhivpuri project, we will begin work on our 1,800 MW Shirawata project later this year. The government has outlined a target of 35 GW by 2030 and 65 GW by 2035.”
— Praveer Sinha, CEO & Managing Director
The company believes its existing hydro assets provide a competitive advantage in developing pumped storage projects while expecting both pumped hydro and battery storage to play equally important roles over the long term.
“Companies like Tata Power already have hydro assets, which gives us an advantage because we already have one reservoir in place. Over the long term, I expect around 50% of storage capacity to come from pumped storage projects and 50% from battery storage.”
— Praveer Sinha, CEO & Managing Director
Management expects pumped hydro projects to generate higher returns than conventional renewable assets, reflecting the complexity and execution risks involved in building such infrastructure.
“These projects carry higher execution risk than conventional solar or wind projects, so they should also generate higher returns. I expect returns to be in the higher teens range.”
— Praveer Sinha, CEO & Managing Director
Havells India Limited | Mid Cap | Electrical Equipment
Havells India is one of India’s leading electrical equipment companies, with businesses spanning cables & wires, switchgear, lighting, consumer appliances, and Lloyd air conditioners. The company focuses on brand-led growth, distribution expansion, and premiumisation across its portfolio while serving both retail and industrial customers.
Havells has successfully maintained its contribution margins despite fluctuations in raw material costs. This demonstrates the brand’s pricing power and its ability to pass on costs to consumers without hurting demand.
“Revenue growth has been strong. If you look at our contribution margins, they have remained fairly stable. Despite volatility in raw material prices, we maintained disciplined contribution margins through staggered and calibrated price increases.”
— Anil Rai Gupta, Chairman & Managing Director
Recent margin compression is a result of tactical increases in marketing spend rather than a structural cost issue. Investors can expect bottom-line profitability to recover as these expenses revert to historical averages.
“The impact on overall margins came from higher advertising and promotion spends. Last year, the summer season was weak and we deliberately underspent on advertising. This year, spending increased sharply. We expect advertising spends to normalize over the full year, which should also normalize our net margins.”
— Anil Rai Gupta, Chairman & Managing Director
The company has fully transferred the impact of higher input costs to the end-consumer across its product portfolio. This proactive pricing strategy protects gross margins in a volatile inflationary environment.
“Cables and wires saw the highest price increases because of their commodity nature, while consumer products saw increases of around 7–8%. By the end of the first quarter, we believe we had passed on the entire increase. If commodity prices remain stable, we do not expect further price hikes next quarter.”
— Anil Rai Gupta, Chairman & Managing Director
Geopolitical tensions in West Asia are causing temporary headwinds for the export-oriented switchgear segment. Management is relying on robust domestic demand to mitigate these international risks.
“A part of our switchgear exports goes to the Middle East and Africa. The decline in exports affected growth in this business. However, strong domestic demand should help offset this impact.”
— Anil Rai Gupta, Chairman & Managing Director
The Lloyd air-conditioner segment has navigated significant regulatory changes regarding energy efficiency ratings. Management believes the industry’s inventory levels are now healthy, setting the stage for steady growth in future quarters.
“The industry experienced several changes, including revised BEE star ratings from January and raw material volatility after February. Despite these challenges, we are satisfied with our first-quarter performance. Inventory in the industry has largely normalized, and we expect healthy demand going forward.”
— Anil Rai Gupta, Chairman & Managing Director
While volume growth faced some pressure, the company maintained strong top-line performance through higher realization values. This suggests resilient consumer demand for premium electrical goods despite economic fluctuations.
“Demand remained strong in the first quarter despite volatility. Volume growth was somewhat affected, but value growth remained healthy. If conditions remain stable, we expect decent growth in the coming quarters as well.”
— Anil Rai Gupta, Chairman & Managing Director
Increasing competition from organized players is seen as a tailwind that drives market formalization rather than a threat. The company’s ongoing investment in distribution and brand building is designed to sustain its market leadership.
“The entry of more organized players is positive because it formalizes the industry. We will continue investing in capacity, brand building and distribution to protect and expand our market share.”
— Anil Rai Gupta, Chairman & Managing Director
Management remains optimistic about India’s domestic demand outlook despite global uncertainties. The resilience of domestic-focused businesses gives the company confidence in sustaining growth.
“Despite the crisis in the first 6 months of the calendar year, I think India Inc has done well overall especially the companies who are more focused on the domestic demand so I’m very hopeful you know the India Inc will continue to do well in the coming times.”
— Anil Rai Gupta, Chairman & Managing Director
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Disclaimer: We’ve used AI tools in filtering and cleaning up these quotes so there maybe some mistakes. Now, if you are thinking why we are using AI, please remember that we are just a small team of 5 people running everything you see on Zerodha Markets 😬 So, all the good stuff is human and mistakes are AI.