ET NEWS

Mumbai: Investors in Tata Capital's Initial Public Offering-the largest domestic issue in 2025-must brace for a modest opening on Monday, said analysts. With the stock's unofficial grey market premium-the extra price investors are willing to pay over the IPO price in the unofficial market before listing-at about 2% above the issue price of ₹326, analysts are keeping their expectations of a listing pop low."Tata Capital's IPO is likely to list on a flat note, with limited immediate upside," said Raj Gaikar, research analyst at Samco Securities. "While the Tata brand adds credibility, the overall sentiment suggests that listing gains may be minimal, as investors who participated mainly for short-term returns are likely to exit post listing."Grey market prices indicate the stock could list at about ₹332-333.The ₹15,512-crore initial public offering (IPO) of the Tata group company, the largest since Hyundai Motor India's ₹27,870 crore issues last year, was priced between ₹310 and ₹326 apiece.The issue was subscribed 1.95 times, indicating moderate investor enthusiasm, Gaikar added.SPTulsian Investment Advisers' analyst Geetanjali Kedia, who had advised investors not to subscribe to the issue, is now recommending a sell on listing."Upon listing, if there are profits, we advise booking gains. Otherwise, investors would be compelled to hold the stock for the long term," she said.Analysts said investors keen on holding the shares must be willing to be patient, and fresh investors can wait for better opportunities to buy Tata Capital shares.“While near-term listing performance might be subdued, the stock has potential to deliver superior gains over time as its financial performance sustains. Hence, longterm investors should stay invested, using a buy-and-hold approach rather than focusing on shortterm volatility or modest listing movement,” said Gaikar. For new investors, Gaikar suggests a wait-and-watch stance. “Investors looking to add exposure to the NBFC space should closely track Tata Capital’s performance post-listing rather than rushing in,” he said. “Once the price stabilises, the stock could provide better clarity on a new entry point for those seeking longterm participation in the company’s growth story.” Kedia suggests new investors should avoid buying its shares, and can look for other more attractive opportunities in the BFSI space.

The Bombay High Court has granted an interim stay in a case challenging the levy of 18% goods and services tax (GST) on restaurant services located within hotels where the room tariff exceeds ₹7,500 per day. This follows a petition in the court's Aurangabad bench challenging the validity of the GST rate notification that links the tax on restaurant services to hotel room tariff.The high court has issued notices to the Centre, the Maharashtra government, GST Council, and other state authorities. The matter is slated to be heard next on November 19.Under the current GST structure, standalone restaurants are taxed at 5%. However, when the same restaurant operates within a hotel whose room tariffs cross ₹7,500, the applicable GST rate jumps to 18%. This differential treatment, according to the petitioner, is arbitrary, irrational and commercially unjustified, especially when the restaurant caters to walk-in customers who are not hotel guests.Appearing for the petitioner, advocate Abhishek A Rastogi, founder of Rastogi Chambers, argued that the rule results in "absurd and disproportionate consequences." "Even if the hotel's room tariff exceeds ₹7,500 for just one day in a year, the restaurant services within the premises are taxed at 18% for the entire year. This outcome was never intended by the GST Council," he told the court.Rastogi further submitted that restaurant services should be taxed based on their nature of service rather than their location within a hotel property. "Restaurants, whether standalone or inside hotels, provide the same kind of service. Linking the tax rate to room tariffs makes no legal or economic sense, particularly when many patrons are walk-in customers," he argued.The petition has drawn attention from across the hospitality sector, which has long raised concerns over the complexities of GST classifications and their impact on business viability. Industry experts have pointed out that dynamic pricing by online travel agents often causes the effective room rate to exceed ₹7,500, even if the hotel's direct tariff is lower.

A mass shooting at a crowded bar on an idyllic South Carolina island has left four people dead and at least 20 injured, officials say. The shooting occurred early Sunday at Willie's Bar and Grill on St. Helena Island, officials said. A large crowd was at the scene when sheriff's deputies arrived and found several people suffering from gunshot wounds. "Multiple victims and witnesses ran to the nearby businesses and properties seeking shelter from the gun shots," the Beaufort County Sheriff's Office said in a statement on the social media platform X. "This is a tragic and difficult incident for everyone. We ask for your patience as we continue to investigate this incident. Our thoughts are with all of the victims and their loved ones," the statement said. Four people were found dead at the scene, and at least 20 other people were injured. Among the injured, four were in critical condition at area hospitals. The victims' identities were not released.

Inflation has risen in three of the last four months and is slightly higher than it was a year ago, when it helped sink then-Vice President Kamala Harris' presidential campaign. Yet you wouldn't know it from listening to President Donald Trump or even some of the inflation fighters at the Federal Reserve. Trump told the United Nations General Assembly late last month: "Grocery prices are down, mortgage rates are down, and inflation has been defeated." And at a high-profile speech in August, just before the Fed cut its key interest rate for the first time this year, Federal Reserve Chair Jerome Powell said: "Inflation, though still somewhat elevated, has come down a great deal from its post-pandemic highs. Upside risks to inflation have diminished." Yet dismissing or even downplaying inflation while it is still above the Fed's target of 2 per cent poses big risks for the White House and the Federal Reserve. For the Trump administration, it could find itself on the wrong side of a potent issue: Surveys show that many Americans still see high prices as a major burden on their finances. The Fed may be taking an even bigger gamble: It has cut its key interest rate on the assumption that the Trump administration's tariffs will only cause a temporary bump up in inflation. If that turns out to be wrong - if inflation gets worse or remains elevated for longer than expected - the Fed's inflation-fighting credibility could take a hit. That credibility plays a crucial role in the Fed's ability to keep prices stable. If Americans are confident that the central bank can keep inflation in check, they won't take steps - such as demanding sharply higher pay when prices rise - that can launch an inflationary spiral. Companies often increase prices further to offset higher labour costs. But Karen Dynan, a senior fellow at the Peterson Institute for International Economics, said this week that with memories of pandemic-era inflation still fresh and tariffs pushing up the cost of imported goods, consumers and businesses could start to lose confidence that inflation will stay low. "If that proves to be the case, in hindsight it will be that the Fed cuts -- and I do expect several more -- are going to be seen as a mistake," Dynan said. So far, the Trump administration's tariffs haven't lifted inflation as much as many economists expected earlier this year. And it remains far below its 9.1 per cent peak three years ago. Still, consumer prices increased 2.9 per cent in August from a year earlier, up from 2.6 per cent at the same time last year and above the Fed's 2 per cent target. The government is scheduled to release the September inflation report on Wednesday, but the data will probably be delayed by the government shutdown. Tariffs have pushed up the cost of many imported items, including furniture, appliances, and toys. Overall, the cost of long-lasting manufactured goods rose nearly 2 per cent in August from a year earlier. It was a modest gain, but it comes after nearly three decades during which the cost of such items mostly fell. The cost of some everyday goods is still rising more quickly than before the pandemic: Grocery prices moved up 2.7 per cent in August from a year ago, the largest gain, outside the pandemic, since 2015. Coffee prices have soared nearly 21 per cent in the past year, partly because Trump has slapped 50 per cent import taxes on Brazil, a leading coffee exporter, and also because climate change-induced droughts have cut into coffee bean harvests. Most Fed officials are still concerned that inflation is too high, according to the minutes of its Sept. 16-17 meeting. Yet they still chose to cut their key interest rate, because they were more worried about the risk of worsening unemployment than about higher inflation. But the concern for some economists is that the ongoing rollout of tariffs and the fact that many companies are still implementing price hikes in response could result in more than just a temporary boost to inflation. "It is a big gamble after what we've been going through ... to count on it being transitory," said Jason Furman, an economist at Harvard University and a former top adviser to President Barack Obama. "Once upon a time, (3 per cent inflation) would have been considered really high." Just two weeks ago, Trump slapped new tariffs on a range of products, including 100 per cent on pharmaceuticals, 50 per cent on kitchen cabinets and bathroom vanities, and 25 per cent on heavy trucks. On Friday, he threatened "a massive increase of tariffs" on imports from China in response to that country's restrictions on rare earth exports. Some companies are still raising prices to offset the tariff costs. Duties on steel and aluminium imports have pushed up the cost of the cans used by Campbell Soups, leading the company's CEO to say in September that it will implement "surgical pricing initiatives." Chris Butler, CEO of National Tree Company, the nation's largest artificial Christmas tree seller, says his company will raise prices by about 10 per cent this holiday season on its trees, wreaths, and garlands to offset tariff costs. About 45 per cent of its trees are made in China, with the rest from Southeast Asia, Mexico, and other countries. The cost of labour and real estate is too high to make them in the United States, he said. Butler also expects there will be a reduced supply of artificial trees and decorations this year, which could lift industry-wide prices further, because most production in China shut down when tariffs on that country hit 145 per cent earlier this year. Production resumed after Trump reduced the duties to 30 per cent but at a slower pace. Butler has pushed his suppliers to absorb some of the cost of the tariffs, but they won't pay all of it. "At the end of the day, we can't absorb the entirety of it and our factories can't absorb the entirety of it," he said. "So we've had to pass along some of the increases to consumers." Many Fed policymakers are aware of the risks. Jeffrey Schmid, president of the Federal Reserve Bank of Kansas City, who votes on interest rate decisions, said Monday that high inflation that results from a loss of confidence in the central bank is harder to fight than other price spikes, such as those that result from supply disruptions. "The Fed must maintain its credibility on inflation," Schmid said. "History has shown that while all inflations are universally disliked, not all inflations are equally costly to fight." Yet some Fed officials say that other trends are offsetting the impact of tariffs. Fed governor Stephen Miran, whom Trump appointed just before the central bank's September meeting, said Tuesday that a steady slowdown in rental costs should reduce underlying inflation in the coming months. And the sharp drop in immigration as a result of the administration's clampdown will reduce demand, he said, cooling inflation pressures. "I'm more sanguine about the inflation outlook than a lot of other people are," he said.