Filter Coffee - India gets Rafales

MSCI shuffle, Auto acquisition, and More IPOs.

🗓 Morning, folks! Markets bounced back sharply on Monday, with the Sensex soaring 1,006 points to close above the 80,000 mark and the Nifty ending above 24,000.

A strong rally in Reliance Industries, private banks, and fresh foreign fund inflows helped stocks recover after two days of selling. But it is retail who deserves all credit—for recognising the floor and going all in amidst tariff chaos.

💡Spotlight: defence stocks saw a strong surge on Monday as rising tensions between India and Pakistan escalated after the Pahalgam terror attack. This triggered heavy buying across the sector.

Paras Defence, Garden Reach Shipbuilders, and Data Patterns rose up to 10%.

Let’s hit it!

1 Big Thing: India signs ₹64,000 crore Rafale deal ✈️

India has officially signed a ₹64,000 crore defence deal to acquire 26 Rafale-Marine fighter jets from France.

The deets: under the agreement, the Navy will receive 22 single-seater and 4 twin-seater Rafale-M jets from Dassault Aviation.

Dassault Aviation designs and builds high end fighter jets like Rafale and sleek private jets under the falcon brand. They ‘re a major force in aerospace, with billions in annual sales and deep ties to both military and business aviation globally.

The package includes training, simulators, performance-based logistics, weapons, and upgrades for the Indian Air Force’s existing Rafale fleet.

The Rafale-Ms, built for carrier operations, will be deployed on INS Vikrant, strengthening India’s naval air power.

What’s new: key part of the jets will be built in India, and the deal also includes plans for setting up local facilities for fuselage production, which is the central structure of the aircraft, along with maintenance

Why it matters: the deal strengthens interoperability between India’s naval and air forces and also deepens strategic ties with France at a time when maritime security in the Indo-Pacific is becoming increasingly critical.

Zoom out: India’s defence spend is already hitting new highs — and big-ticket deals like Rafale-M are a key part of that push.

2. Reliance had a record-breaking year 📈

Reliance Industries posted a monster FY25, with annual revenue crossing ₹10 lakh crore in revenue for the first time ever. Net profit for the year stood at ₹81,309 crore. The stock jumped over 5% on Monday.

Investors got a sweet bonus too, with a ₹5.5/share dividend.

Quick look at the numbers:

Revenue: ₹2.40 lakh crore, up nearly 10% vs ₹2.18 lakh crore (YoY)
Net Profit: ₹21,243 crore, up 0.2% from ₹21,327 crore (YoY)

For FY24, Jio Platforms’ revenue rose 17% YoY while profit soared 22%. At the same time, Reliance Retail posted an increase of 8% in revenue.

Retail: Revenue grew 8%. Reliance opened 1,085 stores, expanding its network to 19,340 locations and 349 million customers.

Oil-to-Chemicals: highest-ever revenue at ₹6.2 lakh crore, with Jamnagar refinery hitting peak crude processing.
JioStar (Media & Entertainment): pulled ₹10,006 crore in revenue after merging Hotstar with JioCinema.
Energy & Fuel: Jio-bp expanded to 1,916 petrol pumps.

On a different note, Reliance has commissioned its first solar panel line at Jamnagar, part of its $10 billion green energy plan.

It’s targeting 10 GW of annual capacity by 2026, aiming to tap into the $12 trillion global energy transition market by 2050.

3. M&M’s heavy duty pickup 🚛

M&M is buying a 58.9% stake in SML Isuzu for ₹555 crore.

The deets: SML Isuzu makes trucks, buses, and special-purpose vehicles, mainly serving India’s light and medium commercial vehicle (CV) market.

M&M will buy SML Isuzu shares for ₹650 each, taking over nearly 44% from Sumitomo and 15% from Isuzu Motors to become the new majority owner.

Under SEBI rules, since M&M is acquiring more than 25%, it must also make an open offer to public shareholders.

The why: Mahindra is looking to strengthen its presence in the fast-growing commercial vehicle (CV) market, especially in the trucks and buses category.

Buying SML Isuzu gives it ready-made products, dealerships, and customers, helping it fast-track growth and compete better against bigger players like Tata Motors and Ashok Leyland.

This deal will double Mahindra’s market share in the trucks and buses segment from 3% to 6%.

SML Isuzu shares hit the 10% lower circuit on the news.

4. Urban Company gears up for ₹2,000 crore IPO 🛠️

Urban Company is preparing to file its draft red herring prospectus (DRHP) for a ₹2,000 crore IPO in the coming days, per ET.

The deets: the offering will include a ₹500 crore primary issue and a ₹1,500 crore secondary sale.

Kotak Mahindra Capital, Morgan Stanley, Goldman Sachs, and JM Financial have been appointed as bankers to the issue.

By the numbers: over the past year, Urban Company closed multiple secondary transactions at a $1.8 billion valuation. In FY24, it narrowed its net loss to ₹93 crore from ₹312 crore a year earlier, while operating revenue grew nearly 30% YoY to ₹827 crore.

Zoom out: Urban Company is moving beyond home services into the D2C space, launching its own water purifiers, smart locks, and even a service for booking house help within 15 minutes.

5. Nykaa, Adani, Coromandel might get MSCI entry 📈

FSN E-Commerce (Nykaa), Adani Energy Solutions, and Coromandel International are in the running to enter the MSCI India Standard Index this June.

The deets: global index provider MSCI will announce changes on May 13, with adjustments kicking in from June 3.

Per JM Financial, Nykaa has the highest chance of making the cut, followed by Adani Energy Solutions and Coromandel. Thermax could get dropped.

If things go as predicted, Adani Energy could see inflows of ~$270 million, Nykaa ~$210 million, and Coromandel ~$200 million.

Why it matters: when a stock gets added to an MSCI index, global funds and ETFs that track the index must buy that stock to match the index weight, bringing new money (inflows) into the stock.

Background: in the February 2025 rejig, around $1 billion of passive flows entered Indian equities, with Zomato, Mankind Pharma, and Dixon Technologies among the new entrants.

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6. Story in data: Safe stash 📊

The RBI’s gold reserves have climbed to a record 880 tonnes in FY25.

Gold has become a strategic asset as global uncertainty drives prices to all-time highs. Central banks worldwide are stockpiling bullion to hedge against inflation and currency risks.

For India, adding gold strengthens forex buffers without dollar exposure. This buying spree reflects a shift toward safer, non-dollar assets.

And with gold's rally showing no signs of slowing, RBI’s bet looks well-timed.

What else are we snackin’ 🍿

🤖 India’s AI sprint: Lightspeed-backed Sarvam AI aims to build India’s first homegrown AI platform within the next six months.

📈 India resilient: the RBI expects India’s economy to grow 6.5% this year, showing resilience amid global uncertainty.

🏭 Factory pulse: India’s industrial output grew 3%, improving from 2.7% in the previous month.

🚀 Liftoff: ISRO has successfully conducted a short duration hot test of the semicryogenic engine.

🖥️ Policy Tweaks: India may allow Chinese firms up to 26% JV ownership in critical electronics, while capping most other sectors at 10%.

That’s a wrap! Don’t let the weekday blues get to you.

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