Are IPO Listings Becoming More Muted?
IPOs have already raised about 12 billion dollars in India this year
On Episode 702 of The Core Report, financial journalist Govindraj Ethiraj talks to Nachiket Mor, Former banker and Visiting Scientist at Banyan Academy of Leadership in Mental Health.
SHOW NOTES
(00:00) Stories of the Day
(01:00) Are IPO listings becoming more muted?
(03:39) Silver sees historic short squeeze in London as gold prices continue to rise
(05:23) Inflation down to 8 year low of 1.54%
(07:15) Global airlines are facing an additional $11 billion in costs because of challenges in aerospace supply chains and how that is affecting airlines and thus travel
(09:22) World Mental Health Day was last week. Why mental health and stress need to be tackled separately
NOTE: This transcript contains the host's monologue and includes interview transcripts by a machine. Human eyes have gone through the script but there might still be errors in some of the text, so please refer to the audio in case you need to clarify any part. If you want to get in touch regarding any feedback, you can drop us a message on [email protected].
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Good morning, it's Tuesday, the 14th of October and this is Govind Rajathiraj broadcasting and streaming weekdays from Mumbai, India's financial capital.
Our top headlines and themes for today.
Are IPO listings becoming more muted?
Silver sees a historic short squeeze in London as gold prices continue to rise worldwide.
Inflation down to an 8-year low of 1.54%.
Global airlines are seeing an additional $11 billion in costs because of challenges in aerospace supply chains and how that's affecting airlines and thus travel.
World Mental Health Day was last week and why mental health and stress needs to be tackled separately.
Muted Listings
The Tata Group, its troubles at the holding company level at Tata Suns notwithstanding, is generally seen as a good bet for investors. But Tata Capital, which received a lukewarm response on the bourses, does not have the same brand leadership in non-bank finance as other companies like Bajaj Finance.
Now, that may not have been the reason for its fairly muted listing, but it's a point to note, particularly for those expecting any and every Tata company listing to set the bourses on fire. Also, there is bumper to bumper traffic on the initial public offer or IPO lane right now. On the other hand, the Tata Group actually has a substantial number of companies doing well on the exchanges right now and for some time in businesses ranging from telecom, hospitality, automotive, software, chemicals, retail, and power to steel.
Few conglomerates anywhere in the world will have that many publicly listed companies, all with high retail and institutional investor engagement. Now, Tata Capital is India's third largest non-bank lender by revenue and was valued at about 140,000 crore rupees or about 15.7 billion dollars when it listed. The shares traded at about 329 rupees, higher than their offer price of 326 rupees, but only slightly.
But its market capitalisation is behind Bajaj Finance and Jio Financial, which are valued at about 72 billion dollars and 22 billion dollars each, according to numbers compiled by Reuters. Meanwhile, Citigroup has said initial public offerings in India could raise as much as 20 billion dollars over the next 12 months. IPOs have already raised about 12 billion dollars in India this year, with another 5 billion said to be added this month alone, partly because of Tata which listed on Monday and LG Electronics India Arm which is going to list on Tuesday.
One reason or rather another reason why Tata Capital was seen as a muted listing was because of great investor excitement over LG, whose shares are expected to list at a premium today. On Monday, the Sensex and Nifty closed down, ending a two-day winning streak. Asia was weak on Monday as expected, though US President Donald Trump did soften his tone on hitting China with 100% tariffs from November 1st.
At close, the Sensex was down 173 points to 82,327 and the Nifty 50 was down 58 points to 25,227. In the broader markets, the Nifty mid-cap 100 was up 0.11% and the Nifty small-cap 0.17%. The rupee came close to its all-time low on Monday but pulled through, mostly because of intervention by the Reserve Bank of India. Reuters said news of an Indian trade delegation's visit to the United States also provided some relief.
The rupee closed at Rs.88.67 against the dollar, nearly unchanged from its previous close of Rs.88.68.
Gold and Silver
Gold prices hit a fresh record high on Monday after US President Donald Trump renewed tariff threats against China, which of course he moderated somewhat a little later. Ongoing strong investment and central bank demand should offer further support for gold. We target a move to $4,200 per ounce.
According to UBS analysts who spoke to Reuters, spot silver was up 1.5% to $51 per ounce after hitting a record of $51.70, driven once again by similar factors as gold. Goldman Sachs said on Sunday that silver prices were expected to rise in the medium term thanks to private investment flows but warned of heightened near-term volatility and downside risks compared to gold. Bank of America on Monday raised its forecast, lifting its 2026 outlook for gold to $5,000 per ounce and for silver to $65 per ounce.
Bank of America was the first major bank to raise its gold price forecast to $5,000 per ounce for 2026, according to Reuters report, which is of course as clear a direction as you can get as to where gold prices could go, if indeed you believe in the gold story. Bloomberg, meanwhile, reported that silver hit the highest in decades as a historic short squeeze in London intensified. Spot silver climbed about 3% to about $52 per ounce, gold crossed $4,070 an ounce, and platinum and palladium prices were also up.
As a background, according to Bloomberg, the silver market is less liquid, roughly nine times smaller than gold, amplifying price moves, and without a central bank bid to anchor silver prices, even a temporary pullback in investment flows can trigger disproportionate corrections.
Retail Inflation Is Down
The consumer price index, or CPI, was down to 1.54% in September from 2.07% in August, according to data released by the Ministry of Statistics and Programme Implementation on Monday. This is the lowest in eight years, after June 2017, that is.
The increase in August, by the way, was the first monthly rise in inflation in 10 months, and of course this is close to the Reserve Bank's lower tolerance threshold of 2% under its inflation targeting framework. More Manufacturing in Electronics The world's largest electronics contract manufacturing firm, Foxconn, could invest about Rs 15,000 crore or close to $2 billion in Tamil Nadu and create about 14,000 high-value engineering jobs as part of its next phase of expansion in the state, according to State Industries Minister TRB Raja in a report in Business Standard that new investments will focus on artificial intelligence-led advanced tech operations, value-added manufacturing and research and development integration, and the investment could spread across multiple locations across Tamil Nadu, a delegation of top Foxconn officials met Chief Minister M.K. Stalin in Chennai earlier.
The Importance of Change
Joel Mokyr, Philippe Aghion, and Peter Howitt have been awarded the Nobel Prize for Economic Sciences for their work explaining how innovation and creative destruction drive economic growth.
In awarding that prize, the Nobel Organisation said the three economists helped deepen the understanding of the drivers of the pickup in economic growth to levels that are high and relatively stable by historic standards. Their work has stressed the importance of science-based innovation and a willingness to accept change even when it has some negative consequences for particular businesses or groups of workers, according to the Nobel Organisation.
Why Airlines Are Facing Extra Costs
Global airlines faced more than $11 billion in extra costs from supply chain disruption this year, according to the International Air Transport Association, in a report produced with consultants Oliver Wyman.
This is also the first attempt of sorts to quantify the impact of a five-year supply chain crisis that has driven up fares and led to flight cancellations of the kind we are also seeing in India, though perhaps a little less than previous years. The report says challenges within the aerospace industry's supply chain are delaying production of new aircraft and parts, resulting in airlines re-evaluating their fleet plans, and in many cases keeping older aircraft flying for extended amounts of time. The worldwide commercial backlog reached a historic high of more than 17,000 aircraft in 2024, significantly higher than the 2010-2019 backlog of around 13,000 aircraft per year, according to the IATA report.
This slow pace of production is estimated to cost the airline industry more than $11 billion in 2025. This, in turn, is driven by four factors. The first, excess fuel costs about $4.2 billion because airlines are operating older, less fuel-efficient aircraft.
Additional maintenance costs another $3 billion because the global fleet is aging and older aircraft require more frequent and expensive maintenance. Increased engine leasing costs about $2.5 billion. Airlines have to lease more engines because engines spend longer on the ground during maintenance.
Lease rates have also gone up by about 20% to 30% since 2019. And surplus inventory holding costs about $1.4 billion because airlines are stocking more spare parts to mitigate unpredictable supply chain disruptions, increasing inventory costs. A lot of this could apply to many industries, but the airlines, I guess, give you a stark insight on what is happening, the outcome of which you tend to face when you book your next flight.
In 2024, IATA says passenger demand rose more than 10%, exceeding the capacity expansion of about 8.7% and pushing load factors to a record 83.5%. And this trend in rising passenger demand has continued into 2025.
The World Mental Health Day
Friday, October 10th, last week, was World Mental Health Day.
The World Health Organisation says the overall objective of the World Mental Health Day is to raise awareness of mental health issues around the world and to mobilise efforts in support of mental health. The day is also an opportunity for stakeholders working on mental health issues to talk about their work and what more needs to be done to make mental health care a reality for people worldwide. Mental health is an issue many workplaces are also grappling with, including in India.
However, there is a tendency to confuse or use mental health and workplace stress issues interchangeably. A new report by Nachiket Mohr and Iti Bhargava of the Banyan Academy of Leadership and Mental Health based in Chennai titled, The Workplace Mental Health Model Building Healthy and High-Performing Workplaces in Stressful Job Environments argues that demanding jobs and high-stress environments do not directly impact an individual's mental health, but trigger a sense of self-moderator, which is SSM, which then leads to mental health outcomes. The moderator is modified by the workplace's organisational design and individual traits, and we'll come to that in a moment.
The report and paper proposes a workplace mental health model, or WMH, which suggests that by addressing these SSM modifiers through evidence-based interventions at organisational and individual levels, even in high-stress environments, organisations can have mentally healthy workforces and build high-performance workplaces. I reached out to Nachiket Mor in the past, and I began by asking him to walk us through the key takeaways from the report, including the separation of mental health and stress issues.
INTERVIEW TRANSCRIPT
Nachiket Mor: One of the popular ideas is that stress leads to poor mental health in young people, older people, and indeed I'm not going to say that there's no basis to that. There is certainly some figure, but if stress was the causal element, then everybody who's stressed should be experiencing poor mental health. We don't actually observe that.
What we observe is that some people indeed react very poorly and some don't. Olympic athletes, for example, under high stress environments perform really well. I've had experiences of traders that really buzz under the environment of stress.
The research that we saw and we ourselves are doing, it isn't so much stress that is the principal factor. It is an important external driver, but there is something about what is happening in your mind either because of the environment in which you are placed or what's going inside you that is unlinked to stress. That actually what we would call moderates the impact of stress and either you can get actually very good performance and very good mental health or very poor mental health even with moderate stress because something about you is not quite functioning as it should and it's not just internally, maybe something in which you're placed.
Govindraj Ethiraj: Right, so there are two pathways that you've talked about and the model that you've created and in a way presented graphically and there's this pre-motivational, motivational and mental health outcomes. How do these two pathways work, the institutional and the individual, particularly when it comes to response to having recognised this problem?
Nachiket Mor: We hypothesise the existence of a workplace context or something that we call a sense of self-moderation. As the name suggests, it is an indicator of how strong is your internal antenna or your internal sense of self-worth or your sense of confidence about who you are. Naturally, as you can tell, this is impacted by two things.
One is internal to you, what kind of a person you are, what kind of environment you've grown up in, what we call dietheses, are there issues in your life when you began, before you came into the job that has had an impact on this, are there factors outside your control that are organisation driven, that are driving, you may start out with a good sense of self but maybe there's something going on in the organisation that is kind of beating it down and that it's not allowing you to function at the highest possible level. These are the two broad sources of what we call modifiers or the moderator that we are interested in. So what we want are situations in which the modifiers are working to build up your sense of self rather than bring it down.
Govindraj Ethiraj: How would that work potentially in an organisation? I mean, including from your own experience where you worked with maybe forex traders who fit exactly that definition that you spoke of versus maybe others who may have been suffering.
Nachiket Mor: My own experience, before I had started to formally study this, as I was mentioning to you earlier, I would hire a lot of people in the treasury of the institution which I was working in. We were a large treasury, every trader carried large positions, markets moved all the time and what I found very quickly, we spent a lot of time hiring these people from the best institutions, lots of time spent interviewing people etc. But what you found is the minute you got these people into the job and gave people a position, some people just buzzed.
Even if the day didn't go so well, they would be sad but there wasn't a sense of brokenness whereas there were others that just shrivelled up and we define that as a modifier called goodness of fit which we think is an important modifier that has an impact on the sense of self. If you're not fit well into the job, what we would do instinctively is to take some of these people that were really smart and bright, we had spent a lot of time working with them, maybe they were much better as analysts, they could not hold a position but they could guide through their models, through their thinking, through their analytics, people who actually had that state of mind. Our advice to organisations based on this insight and that particular goodness of fit modifier is that recruitment should not stop at the point of giving the employment letter, it must continue for some more time and you must really spend time figuring out what the goodness of fit is.
I'm starting to see similar instances in hospital settings where for example I was told that because of need and other pressures, for example they take up a job because oncology is the hot thing, they take up a job in leukaemia. Now not everybody can deal with a child and unfortunately you've now gotten into it and what you find is that some people really get into it and really have the sense of empathy with the child and can progress well and can work well even though sometimes things don't go well but others go into deeper set of issues, they then need to deal with separately. So there are many instances in which this particular modifier called goodness of fit has an impact on the sense of self.
Govindraj Ethiraj: Let's say chart out a path, I mean even let's say to do early diagnosis in organisations and for individuals as well, are there red flags, are there some things that organisations can do so as to distinguish between the kinds of challenges people are facing and of course if I'm an individual can I self-assess in some way?
Nachiket Mor: There are many things that are going on because as you might have seen from the chart, goodness of fit is only one of them. There is a deeper problem that you see both in college settings, you see it in workplace settings, what we call socially constructed perfectionism. This idea that there is one job, I must become MD, this is one path and that is success and you see this, you'll see films made about, if you don't become an IAS officer you'll become somebody that serves tea in a tea shop.
This idea that there is one perfect goal and there is only one perfect path. We are working in college settings where we are talking to faculty about what is your strategy for example to motivate a student. Some argue that doing public display or GPAs, making sure that you know who the top ranker is, and who's not the top ranker is the way forward.
Our understanding is this actually does not lead to a strong sense of self and you start to hurt people by driving this kind of sense of perfectionism. Clearly as organisations there are two levels of diagnosis one would do. One is to try and understand and it's not hard, it's not as if people are not signalling to you that they're not fit well, that they are not working well in a particular job.
I would say our own experience and the research we are doing suggests asking people is often a good place to start in terms of what kind of goodness effect they have. There are of course other issues that are internal to them like financial stress, other situations that they are experiencing and these people may or may not be willing to share with the company. This is something that is private to them and it's something that they are struggling with but what prevents an organisation from saying we will offer this particularly may be important in blue-collar workers good financial advisory services not just literacy but actually work with you to help you think about some of the issues that might be challenging particularly given lower incomes or moderate incomes that you might have. So at both levels I don't think diagnosis is such a problem but of course what we are doing in our research is we are talking to a wide variety of people both white-collar and blue-collar in organisations and some of them have asked us to work with them to understand whether in this organisation the sense of self as a moderator is strong and is it not doing as well and there are fortunately standardised tests and questions one can ask people that can help us assess this and then build out a set of interventions.
Govindraj Ethiraj: Right in the passage of time you talked about hiring forex traders and working with them. I'm guessing between that time and today much has changed. I mean we've obviously lived in a far more social media intense environment, exposure to content images, text and algorithmically induced control and so on.
All of that affects mental health one way or the other. How are you seeing this phenomenon from your vantage point as in how have things changed and to what extent are more people perhaps suffering and therefore what should be or can be say a more structured response particularly in organisations?
Nachiket Mor: Clearly more challenges are coming. You know you expected to join an organisation and retire with that organisation and you had the confidence that one way or the other there was an implicit contract for less. It is very clear now that no organisation, perhaps some government organisation but certainly nobody outside it, is willing to give you any such assurance.
Similarly, the organisation has no assurance. There is a long-term relationship that one would have. One is constantly you know aspiring to move up the ladder jumping ship doing this that and the other and that certainly introduces a level of uncertainty and a level of insecurity and a level of risk that can be quite challenging and the point you made about social media it doesn't help that sometimes there are images being broadcast about what the perfect life is, what this founder did and what this IPO resulted in so many millionaires and billionaires and you look at your bank balance and you're counting pennies. So you know clearly there is that kind of stress.
I must say it's not all bad. We have this general view that social media is an unmitigated disaster and that the only thing that's coming out of it is mess. Actually, that's not entirely true and the evidence suggests that people are forming communities, people are forming groups that actually are good substitutes even if not perfect for communities they might have formed around them.
If you go to cancer hospitals, gaming is encouraged as a way to deal with stress. World of Warcraft has all environments in which you can start to feel much more engaged in a community that is salutary, that is salutogenic. The question of course is how do you make sure that you get the good and don't necessarily get caught up in the bad and again that comes back to the whole sense of selfishness because anything done to excess whether it's exercise or gaming can become addictive, can become damaging.
Of course, separate work one needs to do to think about how to address this concern but I would say the environment is offering both an opportunity and a challenge.
Govindraj Ethiraj: Thank you so much for joining me today.
