F&O Reform Next?

Good Morning. Good morning. Markets regulator, the Securities and Exchange Board (SEBI) of India's steps against Jane Street showed the murky side of the country’s booming options market, which The Core has pointed to multiple times. As the US-based trading giant seeks SEBI's nod to trade again, the bigger question remains — can retail investors ever stand a chance in a market ruled by high-frequency traders?

In other news, the aviation regulator, the Directorate General of Civil Aviation (DGCA), wants fuel switches on all Boeing 787s checked. Meanwhile, inflation cools a little.

DECODE THE NEWS

Jane Street: Is It Time To Reinvent Rules For The Derivatives Market?

What?

The US-based trading firm Jane Street was accused by the markets regulator, the Securities and Exchange Board of India (SEBI), of manipulative practices that allegedly led to unlawful profits in the country.

The firm reportedly made Rs 36,500 crore in unlawful profits and has been temporarily banned from trading in India. It has since deposited Rs 4,843.58 crore in an escrow account, seeking a reversal of the ban.

SEBI claims Jane Street manipulated prices on options expiry days, especially in indices like Bank Nifty, through aggressive high-frequency trades designed to influence settlement prices.

Earlier, Jane Street had responded, saying that SEBI had misunderstood its trading strategy and also alleged its use of ‘inflammatory language’.

Why Does It Matter?

The Jane Street saga has once again brought the intricacies and complications of options trading under the spotlight.

The world of F&O trading is ruled by large proprietary firms with retail investors sitting at the short end of the stick.

While Jane Street is the first of its kind, there have been other similar scandals before. “I can compare this with the co-location scam, where brokers used to take advantage of the colocation facility. They say that you got a price advantage because of the HFT (high-frequency trading) software you had, your HFT trades were executed much faster than other brokers who are similarly placed,” said Ravi Hegde, founding partner at RHP Partners and securities expert.

Trading firms use a mix of high-speed computers that can process enormous amounts of data in real-time, using low-latency networks, co-location services that ensure time isn’t wasted, all designed to take advantage of short periods of opportunities that lie in the markets.

Retail traders who are at the other end of the spectrum do not have the tools, and only a select few understand the intricacies of the trade as much as trading firms do.

What Next?

In light of the developments on Jane Street, there is a growing consensus that regulatory and exchange-level surveillance of trades must be strengthened through reporting requirements, imposing limits on how much can be traded on expiry and more such measures.

Greater transparency could also help level the playing field for all participants in the derivatives segment.

MESSAGE FROM OUR SPONSOR

Finally, a powerful CRM—made simple.

Attio is the AI-native CRM built to scale your company from seed stage to category leader. Powerful, flexible, and intuitive to use, Attio is the CRM for the next-generation of teams.

Sync your email and calendar, and Attio instantly builds your CRM—enriching every company, contact, and interaction with actionable insights in seconds.

With Attio, AI isn’t just a feature—it’s the foundation.

• Instantly find and route leads with research agents

• Get real-time AI insights during customer conversations

• Build AI automations for your most complex workflows

• Join fast growing teams like Flatfile, Replicate, Modal, and more.

Start for free today.

CORE NUMBER

$5.51 billion

That’s how much India’s National Stock Exchange (NSE) raised via Initial Public Offering (IPOs) in H1 2025. The NSE ranked fourth globally in IPO fundraising during the first half of 2025, said S&P Global Market Intelligence.

By the numbers:

• 8.9%: NSE’s share of global IPO proceeds

• 119: Number of IPOs in India during H1 2025

• Rs 37,682 crore raised in H1 2024 by 157 IPOs — more listings, lower overall value

• Rs 1.71 lakh crore / 333 IPOs: Total raised in full-year 2024

State Of Play: While IPO momentum slowed early in 2025 due to global equity volatility, according to S&P, a rebound is underway. Analysts expect a strong pipeline of listings over the next three to six months.

Zoom In: HDB Financial Services, a subsidiary of HDFC Bank, raised Rs 12,500 crore in June — the largest IPO this year. Others like Oravel Stays, Fabindia and Hero FinCorp, which had delayed listings in previous years, may revive shelved plans, depending on market conditions.

FROM THE PERIPHERY

DGCA Orders Safety Checks. India’s DGCA has ordered all airlines to inspect the locking mechanism of fuel control switches on Boeing aircraft, including 787s, by July 21. This follows the AI171 crash probe that revealed both switches were abruptly moved to “cutoff” just after take-off, cutting engine thrust.

Implications: Despite FAA and Boeing deeming the switches safe, Etihad and Singapore Airlines have launched checks. The incident has raised global concerns about possible design or operational vulnerabilities in newer Dreamliners.

What’s Next? Air India CEO Campbell Wilson advised staff to stay focused and avoid speculation. He confirmed all Dreamliners were cleared post-inspection and emphasised commitment to safety, values, and supporting the investigation as it continues.

Inflation Cools Sharply: India’s retail inflation fell to a six-year low of 2.10% in June from 2.82% in May. Food prices dropped 1.06%, with vegetables plunging nearly 19%, easing household cost pressures.

By the Numbers: Meanwhile, wholesale price inflation (WPI) slipped to a 20-month low of -0.1% in June, per government data, thanks to softer food and fuel prices.

What’s Next? Economists say these figures create room for the Reserve Bank of India to prioritise growth and consider more rate cuts later this year, if global risks stay contained.

SAEL Bets Big on Solar: Indian clean energy firm SAEL Industries will invest Rs 82,000 crore ($954 million) to build a 5 GW-per-year solar cell and module plant in Uttar Pradesh, Reuters reports.

Backdrop: Construction starts this year, boosting SAEL’s total module capacity to 8.5 GW. This supports India’s plan to use only domestic solar cells in government projects from June 2026.

What’s Next? SAEL aims for 18–20 GW power capacity by 2030 and plans to launch an initial public offering (IPO) soon. With revenue nearly doubling to Rs 6,870 crore in FY25, SAEL is betting big on India’s green energy surge.

😒 UGHH

You Can Check Out, But You Can’t Unsubscribe. A US Federal Appeals Court blocked a click-to-cancel rule that the Federal Trade Commission (FTC) passed in October 2024. The new regulation would have made it mandatory for companies to make canceling subscriptions as easy as signing up for them. The rule also would have required platforms like Netflix and Prime Video to establish clear consent before converting free trials into a paid subscription and clearly inform consumers when a promotional rate ends. 

Flashpoint: The court argued that the FTC failed to conduct an economic assessment analysis before instituting this rule. Critics say that striking it down is “yet another handout to corporations” at the cost of the people.

Future: While this ruling only applied to the US, it could have a trickle-down effect on the practices of platforms in India too. Already, canceling subscriptions isn’t easy. If companies standardise their practice across the world, it could make canceling subscriptions even harder for users in India, which is already a price-sensitive market.

THE SIGNAL DAILY

Where is India's Premium Petcare Market Headed? 

The petcare industry is booming in India. A Redseer report from last year said that pet ownership in India is growing at a rate of 4-5% right now. From 26 million households in 2019, 32 million households had pets in 2024. At the same time, the pet care market is also growing by 18-20%.

It’s one thing to spend on your pets, but Indian pet parents don’t stop there. They’re also buying premium products for their pets too. Think: 10,000 rupees worth hypoallergenic beds, and costly organic, free-range chicken and duck pet food, air dried snacks and treats. 

In the latest episode of The Signal Daily, we’ll hear from consumers and petcare professionals about this trend toward premiumisation in the petcare industry in India. Why are so many willing to shell out bank for their pooches? Will more pet owners across the country transition into being such “pawrents”? 

The Core produces The Signal Daily. To check out the rest of our work, go to www.thecore.in

PODCAST

On Episode 633 of The Core Report, financial journalist Govindraj Ethiraj talks to Madhavi Arora, Chief Economist, Emkay Global Financial Services.

• Indian markets want high frequency algo traders back

• Silver is now the preferred metal, even over gold

• Inflation hits six year low

• DGCA asks airlines to inspect fuel control switches of all Boeing aircraft

👥 THE TEAM

✍️ Zinal Dedhia, Salman SH, Kudrat Wadhwa | ✂️ Rohini Chatterji | 🎧 Joshua Thomas