On Episode 1027 of The Core Report, financial journalist Govindraj Ethiraj talks to Bhavesh Jain, Managing Director & CEO at TransUnion CIBIL.

SHOW NOTES

(00:00) Stories of the Day

(01:19) Nifty Posts Best Weekly Performance In 5 Years As FIIs Step Up Buying

(02:09) Oil Prices Drift Lower But Still Held Down By Uncertainty

(06:19) Adani In $2.8 Billion Deal For Europe’s Second Largest Liquid Storage Company

(07:21) India’s Gold Loan Market Is Growing To Sizes Unimaginable And Is Half Of Mortgages As Stress Rises

(20:41) Govt To Mandate Energy Storage For Electricity Utilities

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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 feedback@thecore.in.

Good morning, it's Friday, the 6th of November, and this is Govindraj Ethiraj broadcasting and streaming weekdays, usually from Mumbai, India's financial capital, but in transit right now.

Our top stories and themes, and a quick reminder, we are going to be off on Tuesday next week, which is the markets holiday, but we'll be there on Monday, which is a working day. And of course, the five-day Diwali festival kicks off today with Dhanteras, so happy Dhanteras, and we've got some interesting data for you if you are a buyer of gold and silver, particularly on a day like this.

And that brings us to our top stories and themes…

The Nifty hosts the best weekly performance in five years as FII step up buying

Oil prices drift lower, but still held down by uncertainty.

Adani in $2.8 billion deal for Europe's second largest liquid storage company.

The government to mandate energy storage for electricity utilities.

India's gold loan market is growing to sizes unimaginable, and that brings with it all kinds of challenges.

Markets, Oil, AI and Adani

The markets have clearly turned, at least for now.

The benchmark Nifty 50 and Sensex have jumped nearly 8% in six sessions, in what is said to be their longest winning streak in a year, and also trimmed their year-to-date losses to 6.5 and 7.4% each. Compilations from Bloomberg and Reuters say that the benchmark NSE Nifty 50 index is near its best weekly performance in five years. Since October 1st, the Nifty 50 has risen almost 9% through Thursday, even as the MSCI Asia Pacific index has fallen about 8%.

Foreign investors have bought shares worth about $770 million on Wednesday, according to provisional data, and are likely to have bought substantially on Thursday as well. This being Wednesday was one of their biggest single-day buys in India since October 2025, taking November's net inflow so far to about $2.3 billion, a Reuters report said. Elsewhere, oil prices also fell following the results of the midterm elections in the United States, which saw Democrats resoundingly beating the Republicans and taking control of the United States Senate Brent crude futures were up actually slightly on Thursday, but down compared to previous days to now about $95.40, so much below $100 a barrel right now.

Sharper fall in oil prices is possible, but seems unlikely right now as uncertainty over West Asia continues. Remember, US President Donald Trump still has it within his powers to go ahead with the war or continue bombing as he has threatened in the past. There are several factors now playing out in the markets.

One of them, of course, is the AI flip trade, which had begun even before the results of these midterm elections and will surely lead to a slowdown in AI infrastructure spend. So in the United States, the nature of Democrat victories could leave half of proposed AI data centre additions across the US vulnerable to stricter local scrutiny and pushback, according to a Bloomberg report. Texas accounts for nearly 30% of the US data centre capacity set to come online in 2028, representing by far the largest share of any state, according to research put out by Semi Analysis and reported by Bloomberg, and this was just ahead of the election.

Semi Analysis said a few months of lost time in that market can move the national number. So how this curtailment or potential curtailment of data centre infrastructure, which obviously leads to AI infrastructure, will affect investments or likely investments in the rest of the world, including portfolio investments into India, is something that we will have to wait and see, but it's likely that we will not have to wait long. But with all of this in the backdrop, clearly the first signs of being seen as encouraging, the Sensex rose 2,008 points to close at 79,310, and the Nifty 50 was up 576 points to close at 24,536.

In the broader markets, the Nifty Mid Cap 100 and Small Cap 100 were up 1.9 and 0.5% each. Elsewhere, Indian equities are gaining an edge in Asia thanks to stronger earnings and early signs of a return of foreign investors, a Bloomberg report said, adding that profits at roughly two-thirds of BSE 100 companies that have reported results rose 20% from a year earlier in the September quarter, according to Citigroup. Now, this was the fastest growth in at least five quarters and beat estimates, the brokerage said.

Consumer staples, steel, and financials are among sectors to see earnings upgrades. An acceleration in flows could add to the recent momentum, particularly of concerns over the AI trade, along with the Democrat-strong US midterm showing, prompt a rotation of capital towards laggards such as India, the report said, as quoted by Bloomberg. Analysts also told Bloomberg that there is easing competition for capital for India.

Uday Kotak, founder of Kotak Bank, said on Thursday that India could emerge as a beneficiary of foreign flows if the global AI investment boom unwinds as investors seek markets offering more attractive valuations. Speaking in a virtual address ahead of the Diwali weekend, he said that the kind of leverage which global companies are taking to fund their AI aspiration is also leading to significant overvaluation in many cases. Indian equities have rebounded nearly 10% from this year's lows in early October, coinciding with a sell-off in global AI-linked stocks.

Tech-heavy Asian markets have fallen more than 7% over the same period, highlighting India's relative resilience. Of course, global investors have pulled out a record $29 billion from Indian markets in 2026, but that figure could shift as foreign portfolio investment picks up. All of this is also helping the rupee stay positive and has gained about 0.2% to end at about Rs.94.47 on Thursday, tracking gains in most Asian currencies, according to Reuters.

Meanwhile, the Securities and Exchange Board of India, or SEBI, has relaxed a Know Your Client requirement, or KYC requirement, for overseas individual investors, allowing those from jurisdictions that are Financial Action Task Force, or FATF, compliant to complete digital onboarding without being physically present in India. SEBI said on Wednesday that the revised rules which will take effect from December 3rd apply to non-resident Indians and foreign nationals. Key changes include digital submissions and video-based verifications.

However, foreign nationals who seek an India investing licence under the Foreign Portfolio Investor route will continue to be governed by SEBI's FBI framework. Amongst business and corporate news, Adani Ports and Special Economic Zone said on Thursday it would acquire Netherlands-based and Europe's second-largest liquid storage operator, EVOS BV, for about $2.88 or roughly $2.9 billion. The acquisition will give Adani, which is the country's largest port operator, a sizable European foothold as it seeks to build a globally diversified integrated transport platform.

Reuters quoted the firm saying, adding that the deal will help Adani Ports scale and diversify its liquid portfolio and gain exposure to the long-term shift towards fuels like sustainable aviation fuel, or SAF, and biofuels. Berger Paints said on Thursday it would raise prices in November and implement cost-efficiency measures to protect margins from foreign exchange volatility and higher raw material costs. Its second quarter profits were up 5.2%, thanks to strong volumes in industrial construction chemicals and international businesses, but raw material costs saw a sharp rise.

All of this, of course, affects most companies in this space, including those dependent on petrochemical-based inputs.

India’s Gold Loan Market Is Growing To Sizes Unimaginable

Gold loans have become the fastest-growing lending segment over the past year. Outstanding balances have reached about 22 lakh crores in July 2026, supported by about 54 million active borrowers and an average balance or loan size of 4.1 lakh rupees per borrower.

21% of all credit-active consumers have now taken a home loan, and that figure we mentioned, that's 4.1 lakh rupees, has doubled in three years. There's a 19% year-on-year growth in Gen Z gold loan borrowers, and Gen Z now accounts for about 21% of gold loan originations, and two in five gold loan borrowers are women. Delinquencies have also increased and more on that in a minute.

All of this forms part of TransUnion CIBIL's latest report, Lending Unlocked Gold Loans, which was released yesterday and highlights key trends in India's rapidly-growing gold loan market. Outstanding balances have grown about three times since July 23, so in the last three years, and continue to rise. One in two low-risk borrowers, amongst those studied by TransUnion, originated another gold loan within 12 months.

Specifically, in the last three months, ended June 2026, which the study looks at 37 million gold loans, valued at about 8.2 lakh crore rupees, were dispersed. Disbursement volumes declined 15% year-on-year, but value increased about 12% during the same period in keeping with rising prices. A few weeks ago, Reuters reported non-bank lenders, Bajaj Finance and Piramal Finance, flagging early signs of stress amongst borrowers taking loans against gold.

Bajaj Finance flagged a rise in the proportion of loans overdue by more than 30 days as part of its July-September quarterly results. A large part of this came from short-term gold loans, which apparently it has now stopped offering. I spoke with Bhavesh Jain, Managing Director and CEO of TransUnion CIBIL, and I began by asking him to walk us through what the overall numbers were looking like.

INTERVIEW TRANSCRIPT

Bhavesh Jain: What's interesting is that when we look at the latest gold loan data point, the overall outstanding has grown to almost 22.5 lakh crore and it's an important milestone because it's now almost half of the mortgage book in the country. One second is that in spite of all the changes happening around globally and locally, gold loan continue to grow significantly over last few years in terms of both volume and value and in fact now we have almost 5.5 crore borrowers who contribute to that 22.5 lakh crore of book size. One second is that what has also changed is that in the recent time the delinquency has gone to 0.3% in August 2026 which has doubled from March 2026. So in a 5 month period, the NPA rates have almost doubled. So while the number of borrowers have grown from few crores to 5.5 crores, the book has grown multi-fold to 22.5 lakh crore but at the same time when we look at the short term window of last 5 months, the NPA rates have shot up and doubled but when we compare it to last year, it has reduced but on a short term basis, it has definitely increased.

Govindraj Ethiraj: And what explains this difference between the whole year figure and the 6 month or 5 month figure?

Bhavesh Jain: It's multiple factors. One is that in terms of the market is moving slightly towards in the recent time towards higher ticket size while the small ticket size less than 2.5 lakh continues to be there because that's where the major demand comes from but the 2.5 lakh greater is happening. Second is in terms of borrowers who have DPD in their credit profile.

So in fact in the recent gold loan origination also, we see 17% of the customers coming through the door have 30 plus DPD. What is DPD? Days past due which means they have some shape and form a delinquency going before they come and seek a gold loan.

One. Second is that which is again building on to the pattern for many quarters in a row is that the customer who comes and applies for a gold loan already has gold in the past. So in fact in the latest quarter, it has gone as high up to 67% that the consumers come and apply for a gold loan.

67% of them already have a gold loan in the past and once that borrower takes a gold loan, 50% of the chances that this borrower will take another gold loan in next 12 months. Now this is a phenomenon very very concentrated to gold loan where it's that customer going one after the other gold loan and has a gold loan before coming for a gold loan and why this is significant to call out is that the moment the borrower has four or more gold loan in their credit file, their delinquency shoots up as compared to the overall NPA rate. Say for example the overall gold loan NPA rate is 0.3%. The borrowers with four or more gold loan it's 0.45 means 1.5 times higher which means that the moment a borrower takes more than four gold loan it becomes riskier and has a higher NPA rate. So there are multiple things happening at the same time Govind since you asked about what has also changed is that while the Gen Z's continue to be relevant for gold loan even in the recent time that 1 in 5 gold loan borrowers are Gen Z but last five months the growth in terms of Gen Z customers taking gold loan is the highest as compared to any age bracket which is 19%. Gen Z's have grown in terms of seeking gold loan. So these all changes have happened as well as in terms of the geographic spread changing where it's the southern states who continue to hold the large balances but in terms of new acquisition growth is more prominent and higher in the western states east and northeast states.

Govindraj Ethiraj: Right so just to go back to the four loans per person let's say sample now you're saying that if it's an average ticket size of 4.1 lakhs therefore one person could have four loans worth at least 16 lakhs sitting with No so that's the overall gold loan exposure outstanding is four lakhs like four loans worth one lakh each outstanding. Okay so let's say even four lakhs that's in any case the median you're saying it can obviously in many cases it would be higher what would be the value of the gold that they would have typically pledged with the bank or NBFC at this point?

Bhavesh Jain: So it is 70-75% is generally the industry average of LTV so add another 30% and we would be there like say somewhere between five to five and a half lakh would be the gold approximately.

Govindraj Ethiraj: Right maybe you would not have a sense of this but I'm just curious so people obviously when they take loans against gold they're taking cash and in other cases whether it's a mobile phone or a car or some consumer durable or home of course there is a specific physical asset now would people be taking these loans in the form of cash to settle other dues or would they be going back to buy something would you have any sense on that?

Bhavesh Jain: So Govind we don't have exact data of the end use of the gold loan but we have put out some interesting data point in our report that the borrowers who have some spotty credit and who get gold loan their cure rate is very high which means that they become zero DPD after taking gold loan there is no direct correlation that they are taking gold loan to settle their loans but in terms of the credit behaviour outcome what we see that the borrowers who take gold loan after a certain duration they end up being in terms of the days past due so that is very significant for borrowers taking gold loan.

Govindraj Ethiraj: Right and this is something you've pointed out in the past that those who take gold loans tend to repay faster because of maybe cultural social reasons as opposed to maybe other kinds of loans.

Bhavesh Jain: Yeah also availability of liquidity at hand.

Govindraj Ethiraj: Right. And you know, a few weeks ago, two banks—Piramal and Bajaj—had flagged signs of stress on their balance sheets, and they specifically said that they saw rise in the proportion of loans overdue by more than 30 days. And this was the July–September results; now there could be other banks as well facing maybe these early-stage challenges. How do you see that from your vantage point?

Bhavesh Jain: Two theta points to look at here is that in 2025 and few quarters of 2026, we saw that almost one in five borrowers seeking gold loan was NPA customer, which means that the borrower will take a gold loan, will definitely have the liquidity at hand through the gold loan, and that gold loan may or may not create a credit loss for a financial institution because it can be auctioned and then there is a certain recovery which happens.

Now, having said that, that borrower does have an NPA trade before he or she is seeking a gold loan, which means that we also need to keep into mind the borrower risk profile, and not just that the gold is an opportunity for somebody to auction, sell, and settle their credit outstanding. That's one view, or one side of the coin we need to look at it: that if one in five borrower in the past were NPA customer seeking gold loan, which means that there is a certain risk profile which is reflected in those seeking gold loan in that proportion. And even in the recent time, through our report, we have said that 17 percent of the borrowers seeking gold have outstanding of 30 or higher days past due, which means they have delayed on their other obligations and they have at the same time also taken a gold loan.

So obviously, whenever you look at stress on any portfolio, the first thing to look at it is in terms of the portfolio quality and the borrower risk profile. So yes, we are seeing that the underlying borrower risk profile in the past or even now does have customers who have days past due or outstanding on other obligations.

Govindraj Ethiraj: Right. And just to refresh once again, most of the gold that's being pledged is jewellery?

Bhavesh Jain: So yes, it's largely that, and obviously you'll have consumers with other forms of gold also, but it does have a large proportion of jewellery.

Govindraj Ethiraj: Right. So if we can, you know, look at the overall borrowing universe, and you said that gold is now half of mortgages, if you can give us a sense on what the overall health of the borrowing economy or the lending economy—both sides—is looking like right now in the country.

Bhavesh Jain: So in terms of retail credit, it's almost nearing 180 lakh crore, with the MPA rates in the range of 1.3 percent—most of the retail credit delinquencies at a decade low. But it's also important not just to get focused on the aggregate number, but also look at layers beneath it. Like through our report, you try to highlight on the gold loan that suddenly a borrower who takes more than four trade lines, or has more than four loans of gold loan, is a riskier vis-à-vis the average gold loan MPA rate.

So it's important to look at... yes, at an headline, on aggregate level, things look fine. But when we peel the onion and we go significantly lower, we have some sub-segments where we need to monitor through the hand-holding with the borrowers to make sure that we continue to have the credit discipline in the country.

Govindraj Ethiraj: Right, I mean you talked about retail credit but you said that overall in terms of mortgages and all other forms of credit you would say broadly our health levels are good at this point of time?

Bhavesh Jain: Yes.

Govindraj Ethiraj: Right. Bhavesh, thank you so much for joining me.

Bhavesh Jain: Great, thank you so much.

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Dhanteras that starts today is the first day of the five-day Diwali festival. By tradition, many Indians buy some gold and silver on this day. Kotak Neo has sent us a report that looked back at 21 Dhanteras days, from 2005 to 2025, and asked a question, what would have happened if someone had bought just one gramme of gold and 100 grammes of silver every Dhanteras bought on each of those 21 days from 2005 to 2025 at the prevailing spot price and held on to their purchases? The answer valued at prices as of 5th November is as follows.

The 21 grammes of gold, which would have cost 76,246 rupees is now worth about 3 lakh rupees or 300,000 rupees, 3.97 or roughly four times the money put in or a gain of about 2,26,000 rupees. The 2.1 kilogrammes of silver costs about 1,05,000 rupees or 105,000 rupees is worth about 3,94,000 or close to 4 lakhs again or 3.75 times gain or 2,89,000 rupees of gain. So essentially both gold and silver, if you'd bought small amounts every year at this time of the year, would have returned roughly four times your investment at this point.

Or seen as an annual growth rate on the actual date of purchases, gold compounded at about 15% a year and silver about 14% a year.

Govt To Mandate Energy Storage For Electricity Utilities

The government is planning to make it mandatory for electricity distributors to buy some energy storage capacity as part of their renewable purchases as it seeks to curb clean power wastage. Details of the policy, including how much storage distributors will be required to buy are still being discussed.

Bloomberg quoted power secretary Pankaj Agarwal speaking on Thursday. The government plans to finalise the rules by March, he said at the Bharat Renewable Energy Summit in New Delhi. The mandate aims to boost investment in batteries that can store surplus electricity and release it when supplies tighten.

Solar generation peaks during the day while wind output fluctuates, leaving the grid with too much power during the day and shortages towards evening when consumption tends to pick up and more so in recent years and of course on hot days. Without sufficient storage, grid operators can be forced to curtail renewable output. Some 11% of solar power generated in India during the hottest months this year was lost to grid curtailments even as demand hit a record, according to that report.

On Wednesday, the government said that it would offer capital subsidies for energy storage projects, including batteries, pumped hydropower and emerging technologies. India currently has an advisory for renewable energy developers to integrate storage into their projects and that requirement will now be made mandatory, the power ministry official said.