Real Estate’s Ascent
India's Real Estate Investment Trust (REIT) market has demonstrated strong growth, reaching Rs 2.3 lakh crore and surpassing Hong Kong in just six years.
This sector is also expected to attract significant investment, with an estimated $3.5 billion flowing in over the next three years, driven by a retail boom. Furthermore, premium housing sales surged by 85% in the first half of 2025, supported by infrastructure development, boosting overall realty demand. The net office leasing in the top seven cities hit an all-time high of 55 million square feet in 2025. Another noteworthy trend is the rise in branded homes, with a 55% increase over the past five years. Also, with the rise of infrastructure in Navi Mumbai, this area is turning into an emerging corporate hub.
IPO Market Dynamics
The Indian IPO market experienced significant activity, with 2025 being a year of frenzy in the primary market. The primary market is expected to witness another test in 2026. Goldman Sachs and JPMorgan anticipate the IPO boom to continue into the upcoming year. Various companies have launched IPOs, including Stanbik Agro, aiming to raise Rs 12.28 crore. Additionally, ICICI Prudential AMC and E to E Transportation Infra IPOs have been notable listings. In the SME sector, multiple IPOs have been launched, with varying subscription levels. The developments in the IPO market will be crucial in shaping the financial landscape for 2026.
Market & Banking
The Nifty concluded 2025 with a 10% increase, marking its tenth consecutive year of gains, which raises questions about its continued rally into 2026. The stock market had days of positive movement, with both the Sensex and Nifty showing gains. Indian banks demonstrated strength in 2024–25, marked by double-digit growth and falling non-performing assets (NPAs). Bank Nifty also achieved new all-time highs due to strong Q3 updates. Moreover, the government is discussing PSU bank mergers with the RBI, with more mega lenders potentially emerging in 2026.
Fiscal and Policy
The government is rolling out new policies and initiatives that will impact the economy. The fiscal deficit for April-November reached Rs 9.8 lakh crore, constituting 62.3% of the FY26 target. The government is also supporting exporters, with Rs 4,531 crore in support announced. The Union Budget 2026-27 is expected to be presented on February 1, by FM Nirmala Sitharaman. The new income tax act for 2025 will be effective from April 1, including updated regulations. Additionally, the deadline for various tax-related activities, such as PAN-Aadhaar linking and filing ITR, was December 31.
Sector Specifics
Specific sectors have shown notable trends. The personal loan segment in India experienced a significant surge, with a 35% growth in 2025, primarily driven by small-ticket loans. Also, there have been hikes in cigarette excise duties, which have caused a decline in the stock prices of companies such as ITC. A rise in the prices of cigarettes and pan masala is expected from February 1 due to government-imposed excise duties. The government is also pushing for developments in electronics components manufacturing, with approvals for 22 proposals and investments of Rs 41,863 crore. The power sector is also expected to recover in 2026, with Jefferies bullish on the sector.
