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India's Emission Rules
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Good Morning. India’s turning up the heat on carbon. Over 280 of its biggest companies — from Reliance to UltraTech — are now set to face penalty-linked targets to cut emissions or buy carbon credits.
The market snapped a three-day losing streak on Monday. The Sensex rose 319 points or 0.38% to close at 83,535, while the Nifty gained 82 points or 0.32% to end at 25,574.
In other news, mutual funds invested Rs 8,752 crore in newly listed companies in the September quarter, keeping the IPO momentum alive. Meanwhile, with less sugar going into ethanol, India’s eyeing 1.5 million tonnes of exports in 2025/26 season.
DECODE THE NEWS
India’s Emission Rules: What It Means For Companies
What?
India just flipped the switch on its first penalty-linked emissions targets — and more than 280 of the country’s biggest industrial players are in the hot seat. Starting this October, companies from Reliance Industries and UltraTech Cement to Vedanta must either cut their greenhouse-gas emissions or buy carbon credits to make up the difference.
The new Greenhouse Gas Emission Intensity Target Rules, 2025, rolled out in October, mark a major milestone in India’s journey toward net-zero by 2070. For now, the rules cover four carbon-heavy sectors — aluminium, cement, chlor-alkali, and pulp & paper — but the government plans to extend them soon to fertilisers, steel, petrochemicals, refineries, and textiles. Micro, small, and medium enterprises (MSMEs) will likely stay out of phase one.
Why?
India has pledged to cut the emission intensity of its economy by 45% from 2005 levels by 2030, but its carbon output keeps climbing alongside rapid growth. The new regime could finally give emissions reduction real teeth while helping build a domestic carbon-credit market — something investors and climate economists have been waiting for.
Of course, change won’t come cheap. Cleaner firms may struggle to squeeze out further reductions, while higher emitters have more “low-hanging fruit.” Credit prices could spike as companies hoard certificates, and experts warn that liquidity and price transparency will take time to develop.
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CORE NUMBER
Rs 8,752 crore
That’s the total amount mutual funds invested in newly listed companies during the September 2025 quarter, according to a report by Ventura Securities — signaling sustained institutional appetite for fresh equity listings despite volatility in broader markets.
Why It Matters: The data underscores mutual funds’ growing preference for small and scalable businesses that could deliver superior returns over time, even as mid and small cap indices cooled off this quarter.
By The Numbers:
Rs 8,752 crore → Total mutual fund investment across new IPOs in Q2 FY26
Rs 2,754 crore → Investment in Anthem Biosciences IPO, the largest allocation
Rs 1,272 crore → Investment in Aditya Infotech
Rs 253 crore → Investment in Brigade Hotel Ventures, a small cap stock
The Big Picture: While equity schemes saw inflows of over ₹1.06 lakh crore, the growth of mid- and small-cap funds slowed sharply, reflecting market corrections. Still, mutual funds’ selective bets on IPOs show confidence in India’s next growth wave.
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FROM THE PERIPHERY
India Resumes Sugar Exports.
India plans to permit sugar exports of 1.5 million tons in the 2025/26 season as lower diversion to ethanol leaves a surplus, government sources told Reuters. The move could pressure global prices but help reduce domestic stocks and support local producers, such as Balrampur Chini Mills, EID Parry, Dalmia Bharat, and Shree Renuka Sugars, whose shares rose by up to 5%.
By The Numbers: India’s sugar output is estimated at 30.95 million tons, up 18.5% from last year, according to the Indian Sugar & Bio-Energy Manufacturers Association (ISMA), which had sought permission to export 2 million tons. The country, once a leading exporter, restricted shipments last year after drought hit production.
What's Next: With domestic prices higher than global rates, only some mills—mainly in Maharashtra—may find exports viable. The government is also considering removing the 50% duty on molasses exports to further ease supply pressures.
Govt Mulls SEZ Reforms.
India is considering reforms to ease barriers between special economic zones (SEZs) and the domestic market to spur exports and manufacturing, Economic Times reported citing sources. The Prime Minister’s Office, along with the commerce and revenue departments, is discussing measures such as rationalising customs duties on domestic sales, allowing SEZs to receive payments in Indian rupees, and permitting domestic units to send goods into SEZs for outsourcing.
Context: Officials said the idea is to evolve SEZs into broader “development hubs” that integrate domestic and export markets, a shift that may require amending the SEZ Act, 2006.
Impact: Industry experts argue that easing customs norms and allowing domestic supplies on a duty-foregone basis could make SEZs more competitive and job-generating. They also seek flexibility for reverse job work and domestic service payments in rupees. A more agile SEZ framework, they say, is critical for India to strengthen its role in global supply chains.
Changing Oil Flows?
Hindustan Petroleum Corporation Ltd (HPCL) and Mangalore Refinery and Petrochemicals Ltd (MRPL) bought a total of 5 million barrels of crude oil from the United States and West Asia for a January arrival, according to a Reuters report.
Fast Facts: HPCL purchased two million barrels of West Texas Intermediate crude and another two million barrels of Abu Dhabi’s Murban crude. MRPL bought one million barrels of Basra Medium crude for delivery in early January. The companies did not disclose seller or pricing details.
Setup: The purchases come amid growing caution among Indian refiners towards Russian oil, following sanctions imposed by the United States on major Russian energy firms. Both HPCL and MRPL have either paused or cut Russian imports in recent months, reflecting a wider trend of diversification among Indian buyers.
Eyewear IPO Wobbles!
Shares of SoftBank-backed eyewear retailer Lenskart slipped as much as 11% in early trade before bouncing back to briefly cross their IPO price.
By the Numbers: The Rs 7,278 crore IPO was subscribed 28 times, despite debate around its valuation.
Market Reaction: Despite the successful raise, the company’s share price fell by 11% on debut, reflecting investor concerns over its valuation and the broader appetite for high-growth but still unprofitable consumer tech firms.
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