Head Start by InCred Money: Vijay From InCred Money

Ganguly's worst decision ever?

Sun, 14 Jun 2026 06:38:13 GMT

23 March 2003. World Cup Final. Wanderers Stadium, Johannesburg. India vs Australia.

This was the biggest match of my lifetime uptill that point. A strong Indian team in a World Cup final against the best team on the planet.

Sourav Ganguly won the toss and elected to bowl first. He had his logic - the pitch had been damp since morning, the last two World Cup finals had both been won by the chasing team, and Zaheer Khan had been the standout bowler of the tournament. The logic for bowling first was not unreasonable.

What followed was a massacre — Zaheer conceded 15 in the first over, Ricky Ponting made 140 not out, Australia posted 359/2, and India were bowled out for 234.

Critics called it the worst toss decision in World Cup Final History. But had Zaheer bowled out Gilchrist in that first over and the opening stand folded at 40 instead of 105, the exact same decision would have been called sharp, well-read, and brave.

That one over is the thing that separates “a tactical masterstroke” from “a huge mistake” and that gap, between the quality of a decision and the quality of its outcome, has a name: Resulting.

What Is Resulting?

Resulting is a term coined by professional poker player Annie Duke in her book ‘Thinking in Bets’.

The idea is simple: we tend to judge the quality of a decision based purely on whether it worked out i.e. the result, rather than whether the decision itself was sound. A good decision can lead to a bad outcome.

A bad decision can lead to a good outcome. And because outcomes are visible while decision quality is invisible, we keep confusing the two.

The problem is especially sharp in situations involving probability and uncertainty including investing.

The Four Boxes Every Decision Falls Into

Russo and Schoemaker mapped this in their book Winning Decisions — a simple matrix that plots your decision process against the outcome across four possible combinations. Understanding which box a decision falls into is what separates disciplined thinkers from people who just follow results.

The most dangerous box is bottom-left: poor process, good outcome. It’s dangerous because you get rewarded despite being wrong. That reward tells you to keep doing what you’re doing. You don’t learn anything. You don’t fix anything. And when luck eventually runs out, the whole thing comes apart.

Think of it this way: if you drive drunk and reach home safely, you got lucky. The outcome that day was fine. But keep doing that and surely once you will get into an accident.

Resulting Can Wreck Your Portfolios

The stock market is a probability machine. Almost every investment decision is made under uncertainty — which means good decisions will sometimes lose money, and bad decisions will sometimes make money.

But because we remember outcomes far more vividly than we remember the reasoning behind our decisions, Resulting becomes almost unavoidable.

You might have invested in a hot stock with poor fundamentals in the middle of a raging bull cycle. You had no study on it, but you bought it because it was very popular. You make a lot of money and feel vindicated. But it’s just Dumb luck.

Now you invest in another stock in the same manner and the market turns. You attribute that decision to the market. But in essence, it was a Deserved Loss.

Similarly, a fund manager who has a clearly articulated philosophy and fund management style and a long proven track record might underperform the market in a bull run. That would be more like Bad Luck.

It is possible that investors overlook this fund and invest in a very risky fund just because it showed better returns during the bull run. They skipped understanding the process and focussed only on the results.

How To Actually Avoid Resulting

A few things that could help:

Write down your thesis before you invest: Why are you investing in this? What are the conditions under which this would work, and under which it would not?
Separate outcomes from decisions in your post-mortem: When a trade goes wrong, ask: was the process flawed, or did I just hit an unlikely scenario? If the process was sound, the right response is to do it again.
Be especially sceptical of recent winners: A stock or a fund that has gone up a lot recently is not necessarily a better investment. Don’t invest in something just because their past results were good.
Think in probabilities: The goal is to be right more often than you’re wrong. A 60% probability of being right, applied consistently across many decisions, compounds into something significant over time.

What this could mean for you

Even the very best fall victims to Resulting.

Pep Guardiola, one of the best football managers of all times, once said about the reaction from fans and critics about his tactic of rotating his players for matches, “If I rotate the team and win, I’m a genius. When I rotate, and I lose, people say “why rotate?”.

At the end of the day, you cannot control outcomes. You can only control the process. And in any game involving probability — sports, investing and even business — the only sustainable advantage is consistently making decisions that are on the right side of the odds. That has a higher probability of success than failure.

This does not mean you will always win. It means that over many, many decisions, the quality of your process will show up in your results. Not on any single bet, but across the full body of work.

To sum it up: ‘Luck is not scalable, but process is.’

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

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Metrics That Might End an Economy

Sun, 07 Jun 2026 08:03:35 GMT

In the last newsletter, we wrote about South Korea and why despite this semiconductor boom, it’s a cyclical market to invest in. Demographics is a big part of that answer. A country where half the population is over 44, fertility is at 0.72, and the working-age share is heading from 71% to 54% by 2050 is a market you trade, not buy & forget.

And it’s not just South Korea. Even Japan, Italy, Germany, China, large economies with world-class markets, are quietly running out of people.

Demographics is the slowest-moving force in economics, and probably the least reported & analysed. And for anyone investing with a long time horizon, it’s worth understanding which countries have the population advantage, and which are simply running out of workers.

And so in this newsletter we break down global demographics through charts and what it means for your portfolio.

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A) Japan
B) Germany
C) Nigeria
D) South Korea

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The Simplest Signal: Median Age

Median age is simply the age that splits a population in half. Half the people are younger, half are older. A country with a median age of 28 is full of workers, taxpayers, and consumers in their prime. A country with a median age of 49 has half its people closer to retirement than to their first job.

China at 39 looks manageable. But China’s one-child policy ran for 35 years, and its fertility rate now sits at 1.0, barely above South Korea’s (more about that below). The demographic cliff is coming, just with a delay. By 2050, China is projected to lose roughly 100 million people, the equivalent of erasing Germany from the map.

India, most of Southeast Asia, and much of Africa sit firmly on the better side of this curve, with young, growing populations still in their peak working years. The charts ahead make this contrast hard to ignore.

Fertility Rate and Dependency Ratio: Two Sides of the Same Problem

Fertility rate is the average number of children a woman is expected to have over her lifetime. A rate of 2.1 is considered as the replacement rate. This means, on average, two children per woman, roughly one to replace each parent so that the total population is maintained.

Low fertility today becomes a high dependency ratio problem later Japan is the live demonstration of that chain. South Korea is about 20 years behind on the same path.

The USA’s fertility rate is 1.6, well below replacement. What keeps its workforce growing is immigration. Without it, the US dependency ratio would be climbing far faster.

Working-Age Share: Who Is Actually Driving Growth

The share of population aged 15 to 64 is a more direct economic measure. It tells you what fraction of a country is in its productive years right now, and how that fraction is changing.

South Korea’s working-age share falls from 71% today to 54% by 2050. That’s roughly 2 million fewer workers every five years, on a base of 52 million people.

India’s working-age share barely moves over the same period. The dividend window is still wide open. Nigeria’s working-age share actually rises through 2050, which is why it’s the one African economy most economists take seriously as a long-run growth candidate.

Population in 2050: who grows, who shrinks

The Demographic Dividend Window

The “demographic dividend” is a specific phase: the period when a country’s working-age share is large, growing, and not yet burdened by a heavy retiree population. It’s the window when economic growth comes almost naturally — more workers, more consumption, more savings, more investment.

Every country gets this window once. The question is whether they use it.

India’s window runs until roughly 2047. That’s 21 years and the trajectory after 2040 starts working against us rather than for us.

India is in a race between its demographic window and its ability to create enough jobs, raise female workforce participation, and build institutions fast enough to absorb 1 billion working-age people productively. That’s the bet every Indian equity investor is making, knowingly or otherwise.

What this could mean for your portfolio

A few thoughts worth keeping in mind:

Japan and Western Europe are not uninvestable, but they are structurally fighting gravity. Japan’s market tripled between 2012 and 2024 on policy reforms but those are cyclical tailwinds. The underlying demographics are a permanent headwind.

China is facing Japan-style demographics but is earlier in the wealth curve, and with fewer policy tools available.

India has the tailwind, and roughly two decades of it remaining. The main question is whether the economy builds fast enough to use it before the window closes around 2047. Every year that passes without enough jobs, enough urbanisation, and higher female workforce participation is a year of demographic dividend that gets wasted.

But if India shows that it can harness this dividend well, then it will be back on top of investors’ radar.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

Samsung, AI, and a Ticking Clock

Sun, 31 May 2026 08:01:32 GMT

Something unusual is happening in a market most Indian investors have never looked at. South Korea’s KOSPI (Korea’s stock market index) delivered more than 75% returns in 2025, making it the world’s top-performing major index. Most people assumed that there would be some sort of correction coming up. Then 2026 happened. Just by the end of May, the KOSPI has almost doubled year-to-date!

And if you look at the last 1 year returns alone, they were a humongous 210%+. That means the index tripled itself in just 1 year.

That is a really rare phenomenon and that’s why in this newsletter we are breaking down this rally and what the future looks like for the KOSPI.

But before that, let’s look at a little history.

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From war rubble to chip powerhouse — 70 years

In 1953, South Korea ended the Korean War as one of the world’s poorest nations. GDP per capita was below most of sub-Saharan Africa. And unlike African countries, Korea wasn’t blessed with the abundance of natural resources as well.

What followed was a deliberate act of state engineering. President Park Chung-hee’s government in the 1970s decided that Korea would industrialise by force. They did so by channeling cheap bank credit to a handful of chosen conglomerates, shielding them from foreign competition, and giving them government contracts.

The deal was simple: take the money, hit the export targets, or lose the funding. Samsung at the time was a textile company while Hyundai was in construction.

These companies then started spreading their wings and became the big conglomerates they are today. Steel, shipbuilding, and heavy industry were built from scratch.

Then in the 1980s, Samsung made a high-risk bet on DRAM memory chips. By the mid-1990s, Korea was the world’s #1 chip producer. The 1997 Asian financial crisis forced painful restructuring, but it hardened the economy. By the 2000s, Korea had added K-pop, cinema, beauty and gaming to its export portfolio.

Chaebols — the conglomerates that ARE Korea

A Chaebol is a large, family-controlled industrial conglomerate. Built through government patronage in the 1960s-70s, they became global giants and never let go of the economy. Samsung (~25% of KOSPI) and SK Group via SK Hynix (~17%) alone represent nearly half of the entire index. Hyundai, LG, and Lotte make up most of the rest.

Historically, Chaebols traded at lower valuations than global peers known as the “Korea Discount” due to opacity and hereditary leadership. The current government has been pushing corporate governance reforms which mandate companies to conduct buybacks, dividends, and simplify holding structures.

Note: The ranges are subject to change based on market movements.

A Country reliant on Exports

Semiconductors and electronics alone account for ~30% of Korea’s total exports. In 2025, record exports hit $709 billion, with AI infrastructure demand pushing chip volumes higher than at any prior point in history.

(Note: Current Account surplus refers to a country exporting more than what they are importing. For context, India runs a Current Account deficit which was ~0.8% of GDP in H1 FY26).

The Big AI Beneficiary

The AI story has largely been told through GPUs — Nvidia’s H100s, B200s. But there’s a second chip that sits right alongside every GPU in every data centre: High Bandwidth Memory, or HBM.

HBM is the memory that allows AI models to process data at the speed they need.

9 out of every 10 HBM chips in the world are made in South Korea. SK Hynix is the global #1 supplier. Samsung is #2. Together, they are the unavoidable chokepoint in the AI supply chain.

This isn’t a temporary edge. HBM requires extraordinarily complex stacking of memory dies — a technology that took Korea decades to perfect. New entrants face a 5-10 year learning curve.

Every time a hyperscaler like Microsoft, Google, Amazon, Meta orders more AI servers, some of that money flows to Korea.

Goldman Sachs has revised Korea’s 2026 profit growth forecast three times already this year, most recently to 130% because actual demand kept beating estimates.

Despite a 100% YTD rally, the KOSPI still trades at just 8.8x 2026 earnings and 7.8x 2027 earnings — a meaningful discount to emerging markets. Even stripping out Samsung and SK Hynix entirely, the rest of the market trades at ~12.9x. Valuations haven’t gone crazy.

Source: Goldman Sachs, FXStreet (March 2026)

Post March, we have seen the KOSPI rally a lot more, but even then, the valuations on a 2026 basis are relatively lower.

But everything is not rosy - The demographic time bomb

This is the part that tends to get skipped when someone talks about Korea nowadays.

South Korea has the world’s lowest fertility rate, 0.72 in 2026, against a replacement level of 2.1. For context, India sits at 1.9. Korea’s rate is less than a third of what’s needed to maintain its population.

The fertility rate has fallen almost every year for two decades, driven by sky-high housing costs, high costs to raise a child, and a job market that makes long-term planning feel impossible for young Koreans.

The consequence is a population that is simultaneously ageing and shrinking.

This was one of the reasons why Korea wasn’t an attractive market before the AI trade took place.

Korea is best understood as a cyclical market, not a structural compounder. The underlying macro will not compound the way India’s young demographic will. This is not a set-and-forget market.

Source: IMF, Worldometer

Bull Case vs Bear Case

A rally led by SK Hynix and Samsung

What does all this mean for you?

For Indian investors, direct Korean stock buying is not straightforward. The practical route is US-listed ETFs, accessible via international investing platforms.

Is this Rally Sustainable?

Partially yes, partially no.

The AI trade is real. SK Hynix’s HBM position is genuinely hard to replicate while Samsung’s scale is unmatched. The government’s governance push has credibility. So, these are not artificial (but artificial intelligence) tailwinds.

But this is a cyclical market, not a structural one. The KOSPI has seen strong bull runs before followed by sharp corrections. The semiconductor cycle can turn and the Hyperscalers can cut capex. For the rally to sustain, AI capex has to continue at the same speed or faster to support earnings and hence the stock prices.

The demographic headwind won’t reverse and Korea will not compound the way a young-population economy would.

And that’s why timing the entry and exit becomes extremely crucial.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

This Is Making You & India Unhealthy

Sun, 24 May 2026 07:52:43 GMT

On 10th May, PM Modi urged Indians to reduce the consumption of a few items. One of those items was edible oil. One may be forgiven for thinking that the message was for us to become healthier.

But that wasn’t really the point. He was making an economic argument. Every litre of cooking oil poured in an Indian kitchen is, to a significant degree, an imported litre. And the country is spending a lot on it.

India spent $19.5 billion (~1.7L+ Cr) importing edible oils (on a net basis) in FY26 alone, making it one of the largest items in our import basket. To put that into perspective, we net imported Petroleum & Crude products amounting to $120 Bn and Gold amounting to $72 Bn in FY26.

India’s merchandise trade deficit (import of goods minus exports) in FY26 was roughly $333 billion. Edible oil alone contributes ~6% of that.

While we all know that too much consumption of oils is bad for our health, in this newsletter, we will also learn why it’s bad for India’s economic health.

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Q. Which edible oil became more expensive globally after the Russia–Ukraine conflict?

A) Coconut Oil
B) Sunflower Oil
C) Sesame Oil
D) Mustard Oil

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From Biscuits to Samosa

Edible oils are everywhere you look.

Most people think edible oil = cooking oil. But that’s just one part of the story. Palm oil, India’s single largest edible oil import, turns up across your entire day, mostly without you realising it.

The biscuits, the instant noodles in your kitchen, the samosas during your Friday office party, all have edible oil woven into them. And most of that oil started its journey on a plantation in Indonesia or Malaysia.

What India Consumes

India consumes roughly 24–25 million tonnes of edible oil a year. That’s about 19.7 kg per person per year, significantly above the 12 kg annually recommended by ICMR. Of this, nearly 60% is imported.

Palm oil is the dominant one. It’s cheap, versatile, and has a long shelf life, which makes it the industry’s go-to. Mustard oil is largely grown domestically and is a strong regional preference in North and East India. Soybean and sunflower oils are almost entirely imported.

The Import Bill: A $19.5 billion hole in our trade balance

India produces around 9.5–9.6 million tonnes of edible oil domestically. It consumes roughly 24–25 million tonnes. The gap of over 14 million tonnes is filled by imports.

The chart below shows how domestic production has barely moved, while imports continue to carry the weight of feeding India’s growing appetite.

The 2022-23 spike tells its own story, Russia’s invasion of Ukraine knocked out global sunflower oil supply, Indonesia briefly banned palm oil exports, and post-Covid demand surged. India’s import bill jumped in step.

Where does it all come from?

Nearly all of India’s palm oil, the single biggest item, comes from just two countries.

That concentration is a vulnerability. Three commodity corridors: Southeast Asia, South America, and Ukraine/Russia, determine what Indians pay for cooking oil. If any one of them runs into trouble, the ripple reaches every kitchen in the country.

India’s Plan to become Aatmanirbhar

The government has been trying to fix this problem for years. The current push runs under the NMEO, National Mission on Edible Oils, with two separate tracks.

Track 1: Oil Palm (NMEO-OP, launched 2021) India produces some palm oil domestically, mostly in Andhra Pradesh, Telangana, and parts of the Northeast. The NMEO-OP aims to expand this significantly, offering farmers a price support mechanism (similar to an MSP) to insulate them from global price swings.

Track 2: Oilseeds (NMEO-OS, launched 2024) This focuses on mustard, soybean, groundnut, and sunflower — the crops Indian farmers already grow. A ₹10,000 crore programme over seven years, aimed at better seeds, higher yields, and getting more land under oilseed cultivation.

Progress exists, but the numbers are sobering. Oil palm coverage has grown from 3.7 lakh hectares in 2020-21 to 6.2 lakh hectares today — but the target was 10 lakh hectares by 2025-26. Total domestic edible oil production has crept up from 8.7 MT to 9.6 MT over the same period, against a target of 20.2 MT by 2030-31.

On palm oil specifically, India is roughly 14% of the way to its 2029-30 production target. The structural constraint is simple: oil palm trees take 4-5 years to yield commercially. Land planted today won’t produce meaningful oil before 2030. Even under the most optimistic scenario, analysts estimate India will still need to import 7-8 MT annually by then.

Why Indonesia and Malaysia could make your grocery bill worse

Even as India works to grow more oil at home, the two countries supplying most of its palm oil are facing problems of their own.

Indonesia - Biodiesel Mandate

Indonesia’s B40 mandate (40% palm oil blended into diesel) already diverts ~2 million tonnes of Crude Palm Oil (CPO) away from exports annually, with discussions underway to push this to B50.

Malaysia - Ageing Trees & Stalled Output

Malaysia’s mature oil palm acreage has declined for four consecutive years. Older trees yield less, the industry is heavily dependent on migrant labour, and production growth has essentially stalled. Malaysia’s 2026 CPO output is forecast to fall from 2025 levels.

Any supply tightening from either country feeds directly into global palm oil prices, and palm oil prices have shown they can move fast. They nearly doubled between 2020 and early 2022, then halved by late 2023, before climbing again through 2024.

The rupee adds another layer of risk. Edible oil is priced in US dollars globally. So India’s import bill is hit twice when things go wrong: once when global palm oil prices rise, and again when the rupee weakens against the dollar.

The Takeaway

Edible oil might not feel like a big-picture economic issue. But it’s sitting at the intersection of food security, inflation, and trade policy. The $19.5 billion we send abroad every year for oil is money that could otherwise stay in the country.

India’s direction, growing more oil domestically, is right. But the timeline is long, and the targets are ambitious.

In the near term, what happens in Jakarta and Kuala Lumpur matters as much as what happens in Delhi. Any disruption to Southeast Asian palm supply, whether from biodiesel policy, land disputes, or weather, flows directly into your grocery bill.

And so it’s in our interest to heed PM Modi’s message to eat less oil, for our health and India’s.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

Trash Is The Next Investment Megatheme?

Sun, 17 May 2026 07:24:13 GMT

Every morning, a garbage truck quietly disappears down your street. Out of sight, out of mind. But where does it all go?

Mostly to an open dumping ground somewhere on the outskirts of your city, piling up, slowly rotting, and releasing methane into the air. Delhi’s Ghazipur landfill is already taller than the Qutub Minar. Mumbai’s Deonar dump has been on fire, literally, more times than anyone would like to count.

And while that sounds like an environmental problem, it is increasingly a business one too. The global waste management market is worth over $1.2 trillion a year, and it is growing. Quietly, without much fanfare, an entire economy is building around what we throw away.

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Why Waste Is Becoming a Bigger Problem

India is urbanising fast. More people in cities means more consumption. More consumption means more packaging, more electronics, more food, more plastic.

India generated around 62 million tonnes of solid waste in 2024. By 2050, that number is expected to cross 165 million tonnes. Meanwhile, landfill capacity is already near its limits in most major cities.

The problem is not just the volume. Miniscule percentage of India’s waste is formally processed. The rest is either dumped, burned in the open, or handled by an informal network of waste pickers with no safety gear and no formal recognition.

What Are We Actually Throwing Away?

Not all waste is the same, and not all of it is a problem. Some of it is a resource waiting to be tapped.

How the Waste Economy Works

Waste management is not one business. It is a chain of businesses, each capturing margin at a different step.

The first layer is collection and transportation, moving waste from where it is generated to where it will be processed. This is often run by municipalities under long-term contracts. Margins are thin but revenues are stable and recurring.

The second layer is processing and treatment. This is where the real value is created. Waste-to-energy plants burn municipal waste to generate electricity. Sewage treatment plants process wastewater and return it for reuse. Material recovery facilities sort mixed waste into recyclable streams. Hazardous waste processors use incineration and chemical treatment to neutralise industrial effluents.

The third layer is recycling and resource recovery, where processed material is converted back into usable raw material: lead from battery scrap, rPET chips from plastic bottles, recovered carbon black from old tyres, copper from e-waste.

Here’s how the waste management flow looks like:

The real money is not in collection. It is in processing and recovery, where technology, scale, and efficiency determine who makes money and who does not.

Regulatory tailwinds are also reshaping this economy. India’s Extended Producer Responsibility (EPR) framework now requires companies that sell plastic, electronics, and batteries to ensure a portion of that material gets recycled. Brands are now paying recyclers to take their waste, which has introduced a second revenue stream, on top of the commodity value of the recovered material.

Who Are the Active Players?

The Indian listed market has a reasonable set of companies spread across different parts of the waste economy.

On the private & unlisted side, Attero Recycling (e-waste and battery metals) and Ramky Enviro Engineers (hazardous industrial waste) are two of the bigger names.

One thing that stands out is the absence of India’s large conglomerates in this space. No Tata Ambani and the likes with a serious waste management play. That could change, and if it does, it would bring both capital and visibility to a sector that has largely flown under the radar.

What Are the Risks?

The structural story is compelling. But a few things could disrupt it.

The two risks that matter most are commodity prices and capital intensity.

Recycling economics are directly tied to the market price of output materials. If lead, copper, or rPET prices fall sharply, processor margins compress fast, and there is no hedge built into most of these businesses.

Processing plants also cost a lot to build and take time to ramp. Many companies in this space are still deploying capital with returns that show up years later, which means free cash flow can look thin even when the underlying business is doing the right things.

The Megatheme

A few structural forces make this more than a feel-good story.

Raw material security is becoming a national priority. Countries that can recycle their own lithium, copper, and rare earths need less from geopolitically sensitive supply chains.

India’s EPR rules for plastics, batteries, and electronics have created guaranteed demand for formal processors — a rare case where regulation is creating a market, not constraining one. And as commodity prices stay elevated, the economics of recovered material keep improving.

The investment space in this sector is very diverse with each players specializing in different segments. The investor who succeeds will be the one that picks the right part of the chain and waits for the right entry.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

The Sugarcane in Your Petrol Tank

Sun, 10 May 2026 07:05:40 GMT

Recently, I wrote about how India’s petrol prices are set, and why they barely move even when crude oil crashes or rises. If you missed it, you can read it here.

But today, I want to talk about what’s slowly replacing petrol itself.

Fundamentally, India has two main problems when it comes to its energy mix. We import about 85% of our crude oil requirements, spending close to $100 billion a year on it. And the other is that we need to make our fuel mix cleaner in terms of carbon emissions and pollution.

The good part is that India is working on a solution. India has been running one of the world’s most ambitious fuel experiments for the past decade. The idea: replace a chunk of imported petrol with ethanol, an alcohol fuel made from crops grown right here. And in 2025, India quietly hit its E20 (20% Ethanol + 80% Petrol) target, five years ahead of schedule.

If you’ve recently read the news, India is formulating a policy to move to E85 (85% Ethanol + 15% Petrol) and E100 (Near-pure Ethanol).

With ambitions as grand as these, it warrants a closer look by us to understand what’s happening in this space.

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Q. One environmental concern around sugarcane-based ethanol is that sugarcane is....

1. Radioactive
2. Extremely water-intensive
3. Imported from Europe
4. Illegal in some states

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What Is Ethanol, and How Is It Made?

Ethanol is an alcohol, the same compound found in beer, just made in industrial quantities and at much higher purity. When blended with petrol, it can power a standard vehicle engine.

To understand how ethanol is made, lets take an example of sugarcane-based ethanol. Cane is crushed, the juice is fermented by yeast, the resulting liquid is distilled to concentrate the alcohol, and then dehydrated to remove the last traces of water. What you end up with is anhydrous (a substance with no water) ethanol, 99.9% pure, ready to blend with petrol.

Some other feedstock used to make ethanol in India is maize (corn) and rice.

Different Technologies of Producing Ethanol

When the actual food part of a crop is used to produce ethanol (as seen in the example above), it is called 1G or First Generation technology. The process here is simpler and more straightforward. This is the ethanol that is currently commercially viable and available at scale.

The drawback, of course, is that the crop gets diverted from food to fuel.

To address this, India wants to move to 2G or Second Generation ethanol, which is produced using agricultural residue instead of the crop itself. The technology is more complex and expensive, and while our OMCs have set up a few plants, they are still in early stages.

Beyond 2G, there is also 3G ethanol, which is algae-based, and 4G, which uses CO₂ as a feedstock. Both are still in the research phase and nowhere close to commercial deployment.

Ethanol vs Petrol: The Honest Comparison

Additionally, there’s one more issue with ethanol blending. Older cars, especially before 2010, were not designed for ethanol blends. Ethanol absorbs water and can corrode older rubber seals and fuel components over time.

Why Going Beyond E-20 is Hard

Hitting E20 was genuinely impressive. Going beyond it will be harder. Three structural problems keep coming up.

Food vs Fuel

India’s ethanol programme has shifted heavily toward grains. Maize now contributes more ethanol than all sugarcane-based sources combined. In 2024, India imported maize for the first time in decades, partly because so much domestic supply was diverted to distilleries. When a food crop becomes a fuel crop, prices move and food security questions follow.

Sugarcane Economics Are Squeezed

The government controls both ends of the transaction: the price distilleries pay farmers for sugarcane, known as the FRP (Fair & Remunerative Price), and the price at which distilleries sell ethanol to OMCs.

Over the past three years, the FRP has risen 16.5% but the ethanol selling price hasn’t moved.

Distilleries are caught in the middle where their input costs are rising, but their revenue is capped leading to a squeeze in their margins.

Engine Compatibility Is a Ceiling

E20 works in standard petrol engines with minor tuning. E85 and E100 need a Flex-Fuel engine, a different architecture that most vehicles on Indian roads don’t have. Until a meaningful share of the vehicle fleet is Flex-Fuel-capable, higher blending targets remain on paper.

Why Everyone Keeps Talking About Brazil

Brazil, the biggest success story in ethanol, is becoming the benchmark for India.

Brazil launched its Pro-Álcool programme in 1975, right after the first oil shock. The government guaranteed purchase prices, subsidised distilleries, and mandated blending. Within a decade, they had the world’s largest ethanol industry.

Today, nearly all Brazilian petrol contains at least 27% ethanol (meaning, no pure petrol). Around 80% of new cars sold are Flex-Fuel. A driver can choose between between blended ethanol (eg. E20) & E100 at the same pump.

Who Is Playing in This Space?

The ethanol value chain has several distinct segments. Each has a different set of players and a different set of risks.

The Final Takeaway

India hitting E20 is a genuine milestone. The infrastructure has been built, the supply chains are working, and the habit of buying blended fuel is becoming normal. That part of the story is largely done.

The next chapter, getting from E20 to E85 and E100, is a harder problem. It requires more Flex-Fuel vehicles, a bigger feedstock base that doesn’t compete with food, and pricing policies that keep distilleries economically viable.

Brazil took 50 years. India is about 10 years into a serious attempt. The direction is right but our success would depend entirely on how consistently the government manages the overall policy for fuels.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

How the Petrol Economics works

Sun, 03 May 2026 07:43:11 GMT

I’m sure you would have noticed this anomaly, when Crude oil was at 60 USD per barrel just a few months back, you were filling your petrol at around ₹100/ litre.

Now, even though Crude oil has spiked above $110/barrel, you are still paying exactly the same.

Petrol pricing in India has very little to do with oil prices. It is one of the least understood parts of the economy.

So in this newsletter, we will unpack this mystery about petrol prices.

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A Brief History of Who Decides your Petrol Prices

Until 2002, the government set every number in the oil supply chain through the Administered Price Mechanism (APM). Even when global crude prices moved, Indian petrol prices didn’t. The losses were absorbed by government-owned oil companies, quietly. The APM was dismantled in 2002, petrol was officially “deregulated” in 2010.

On paper, this meant Oil Marketing Companies or OMCs (Indian Oil, BPCL, HPCL) could revise prices every fortnight based on international crude. In practice, the game changed but didn’t end. Prices still get frozen to manage inflation, OMCs still absorb losses, and the government still pulls levers behind the curtain.

How Petrol is Taxed

A huge chunk of what you pay at a Mumbai petrol pump is just taxes - the State VAT and the Central Excise Duty.

The table makes one thing immediately clear. Since the pump price is frozen, OMC revenue is also frozen at ₹52/litre. Taxes, dealer commission, refining costs — all fixed. The only variable is crude. So the OMC margin is simply ₹52 minus whatever crude costs that day.

OMC breakeven sits at roughly $75-79/barrel at ₹95/$. Above that, every dollar rise in crude erodes margin directly, with no ability to pass it through. At $60 crude, OMCs quietly earn ₹9 per litre. At $120 crude, they lose ₹27 per litre.

But the government doesn’t sit idle when crude falls either. For eg. between 2014 and 2016, as crude crashed from $100 to $26, excise was hiked nine times, going from ₹9.5 to ₹21.5/litre. Similarly, when the crude spikes, excise is cut to reduce the losses of the OMCs.

Government fuel tax revenue has grown substantially without the consumer feeling almost none of it. Petroleum taxes contribute over ₹7.5 lakh crore annually to central and state coffers combined. That is too large a revenue stream for any government to voluntarily give up.

Quickly The Rupee Problem Nobody Mentions

There is a second variable that hits OMCs just as hard as crude: the exchange rate. Crude is priced in dollars. When the rupee weakens, the cost of every barrel rises in rupee terms even if crude has not moved.

At $80 crude, ₹84/$ gives a crude cost of ₹42/litre. At ₹95/$, the same barrel costs ₹48/litre. That is ₹6 extra per litre from a weaker rupee alone, with zero change in global oil prices. Multiply that across India’s daily consumption and a ₹10 depreciation adds hundreds of crores to daily OMC costs.

The dangerous scenario is when a crude spike and a rupee selloff happen together. And they often do. Crude shocks trigger risk-off sentiment globally, emerging market currencies weaken, and India’s import bill rises from both forces simultaneously. OMCs get squeezed on the crude side and the currency side both at once, while the pump price remains frozen.

Who Is Actually Paying

The losses in this system rotate. When crude spikes, OMCs absorb it first. Their profits shrink, balance sheets weaken, and stock prices fall.

When losses grow too large, the government steps in with excise cuts or subsidy packages, shifting the burden to the fiscal deficit and eventually to future taxpayers.

The 2026 cycle captured this pattern perfectly. Crude surged 75% in four weeks to $122 per barrel. Pump prices didn’t move. OMCs bled ₹2,400 crore per day. The government cut excise by ₹10/litre, reducing losses to ₹1,600 crore/day. It helped but didn’t close the gap.

The consumer’s share of any crude windfall across all these cycles? Close to zero. When crude is cheap, the government raises excise, and they, along with OMCs, capture the benefit. When crude is expensive, OMCs and the fiscal deficit absorb the cost. But what you really get is stability of prices across cycles.

What This Means for You

Petrol is a very sensitive topic in India. An upward change in petrol prices can have a direct impact on overall inflation and hence public sentiment. So while petrol prices are deregulated, there is an invisible hand of the Government managing the prices. The government, OMCs, and consumers are in a constantly renegotiated arrangement where each party absorbs the burden when it is their turn.

For investors watching OMC stocks (HPCL, BPCL, IOC), the key variable is not crude alone. It is the gap between the crude cost in rupee terms and the frozen pump price. When that gap is positive, OMCs look cheap and earn well. When it flips, losses appear fast. The rupee adds another layer: a currency that weakens alongside a crude spike is a compounding problem that does not show up in the crude headline but absolutely shows up in OMC quarterly results.

Another way to look at this is that if you’re bearish on Oil prices (i.e. oil will go down), you can be bullish on the profitability of these OMCs.

Next time you see a crude oil headline, the more useful question is not “will petrol prices go up or down?” It is: which layer of this system is absorbing the shock right now, and is that already priced into the stocks you hold?

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

Why You Should Have Nuclear in Your Portfolio

Sun, 26 Apr 2026 07:22:50 GMT

When the US and Israel launched surprise airstrikes on Iran on 28th February 2026, oil dominated every headline. Oil prices spiked, and analysts warned about tanker routes. The closure of the Strait of Hormuz became a dinner table conversation.

But oil was the consequence, not the cause.

The real trigger was something buried underground, roughly 200 kilograms of uranium enriched to 60%, stored in an underground facility at Esfahan. The International Atomic Energy Agency (IAEA) estimates that’s enough material, if pushed to weapons-grade levels, to build nearly five nuclear warheads.

The US launched what it called a surprise attack right in the middle of nuclear negotiations with Iran. President Trump has since said Iran will agree to no longer enrich uranium. Iran’s atomic energy chief has said the exact opposite. As of now, a temporary ceasefire is in place, but the standoff is far from over.

At the centre of all of it: Uranium.

Most people think of uranium as something vaguely dangerous and exclusively military. The truth is far more interesting.

Today, uranium sits at the intersection of clean energy, artificial intelligence, and geopolitics. And for investors willing to look past the headlines, the structural story is one of the most compelling in commodities right now.

In this newsletter, we will unpack uranium’s story and what the future holds for this metal. The formula is simple: If the US wants it, it may be worth analysing for your portfolio too.

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Uranium 101: What Exactly Is It?

Uranium is a heavy radioactive metal dug out of the ground. In raw form, it looks completely unremarkable, just another grey ore. But once processed, it becomes one of the most energy-dense fuels known to science. A single uranium fuel pellet, roughly the size of a fingertip, contains as much energy as:

1 tonne of coal
560 litres of oil
17,000 cubic feet of natural gas

No other fuel comes close.

Here’s how uranium travels from the ground to a reactor:

The step that matters most is enrichment. It determines whether uranium becomes power plant fuel or a weapons-grade material.

At 4–5% enrichment, it runs a nuclear reactor
At 90%+, it makes a nuclear weapon

This enrichment percentage is the difference between a power plant and a bomb. It’s why Iran’s uranium stockpile has always been the real issue underlying the US-Iran conflict. And it’s why the word “enrichment” follows uranium everywhere in geopolitical news.

The Demand Story: Nuclear’s Unexpected Second Act

Source: IAEA, Mirae Asset

For decades, nuclear power was deeply out of favour. Construction costs were astronomical. Timelines stretched to 15–20 years. And two accidents burned a permanent fear into public memory.

Chernobyl in 1986 displaced hundreds of thousands. It became a symbol of what could go wrong.

The Fukushima disaster in 2011 sent uranium prices into a decade-long collapse. Germany announced it would phase out nuclear power entirely. Japan shut down most of its reactors. The industry went into hibernation.

But in the last few years, Uranium’s demand story has gained momentum mainly because of two big reasons.

Clean Energy: The world started running out of easy answers to the energy transition. Solar stops working at night. Wind stops working when there’s no breeze. Battery storage helps, but it can’t carry an entire grid for weeks at a time. If you want clean electricity that flows 24 hours a day, 365 days a year, nuclear is one of the very few options that can genuinely deliver it.

At COP28 in late 2023, over 20 countries, including the US, UK, France, Japan, and South Korea, pledged to triple global nuclear capacity by 2050.

The Rise of AI: Running data centres around the clock is extraordinarily energy-intensive. The IEA projects global data centre electricity consumption will more than double to over 945 terawatt-hours by 2030, roughly equal to Japan’s entire annual consumption. Microsoft has signed agreements for small modular reactors in Pennsylvania. Amazon and Google have followed with their own nuclear procurement deals.

India isn’t sitting out of this story either. India plans to grow its nuclear capacity from roughly 7 GW today to 22 GW by 2032. L&T, BHEL, and NTPC are all lined up to participate.

The Supply Problem: Why More Mines Won’t Fix This Quickly

The supply of uranium will not be able to keep up with the rising demand because:

Concentrated Supply Chain: Kazakhstan alone produces 46% of the world’s uranium. Canada contributes 15%, Namibia 11%, Australia 9%, and Uzbekistan 8%. Five countries supply nearly 90% of global production.

Niger’s political transition and ban on Russian enrichment services are creating a bottleneck.

Extended Timeline: New mines can’t plug the gap in time. Discovery to production typically takes 10–15 years. Even if a mine gets approved and funded today, it won’t produce a single pound of uranium until the mid-2030s.

Declining Quality of Ore: Ore grade is the concentration of uranium in rock. The richer the ore, the more uranium you get per tonne dug up. Historically, miners worked with grades of 0.3–0.5%. Today, most operations work with 0.03–0.1%.

Secondary Supply Is Running Dry: For decades, recycled material and stockpiles cushioned the gap between mine output and reactor demand. The US-Russia “Megatons to Megawatts” programme, which converted Russian nuclear warheads into reactor fuel and supplied 10% of global demand, ended in 2013.

What does it mean for an investor?

Source: Cameco

Here’s What I think…

After Fukushima in 2011, uranium entered a decade-long bear market. The industry went into hibernation. Prices crashed from $73 per pound all the way down to $18.

But now Uranium is rallying. From COVID-era lows of $24 per pound in 2020, uranium ran to over $106 by early 2024, a 340% move in under four years. Since then, prices have pulled back to around $65–70 per pound as speculative heat cooled off.

The structural case for Uranium seems to be intact. Demand is growing, and supply cannot respond quickly. But uranium markets are notoriously thin and illiquid, and prices can swing sharply on a single piece of news. A reactor shutdown, a policy reversal, one hostile government, and the whole market reprices overnight.

If you’re looking to take part in Uranium, there are a couple of options. Physical uranium is not being used for obvious reasons.

You can invest in global ETFs like Global X Uranium ETF, Sprott Uranium Miners ETF, and VanEck Uranium+Nuclear Energy ETF (NLR) through the LRS route. These would give you access to Uranium mining and processing companies.

Uranium and its underlying ETFs have already given stellar returns in the past year. So, as an investor, it may be prudent to wait till the momentum in this space cools. Also, if you are considering Uranium in your portfolio, think of it as a diversification element in your commodities exposure rather than for a quick trade.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

The IPL is serious business

Sun, 19 Apr 2026 06:11:40 GMT

Decades ago, sports teams rarely changed hands. They were like family heirlooms, which were passed down. Today, that is changing. It’s become a common occurrence now that either a Private Equity firm, or a Corporate, or a Celebrity is buying a sports team, and many times at valuations that are unheard of.

Have a look at this data below!

Source: S&P Global Market Intelligence, Deloitte Sports Investment Outlook

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Let’s look at the deals happening in the Indian Premier League.

Rajasthan Royals was just sold to the Somani consortium for $1.63 billion (₹15,000+ crore). Blackstone, a firm managing over $1 trillion globally, spent $1.78 billion (₹16,500+ crore) to acquire a controlling stake in RCB (along with other buyers like Aditya Birla Group, TOI and Blackstone). And In February 2025, Torrent Group bought a majority of CVC Capital Partners’ stake in Gujarat Titans.

While these were the deals that materialised, many others like the Adanis, the Zerodha Kamath Brothers, Glazer family (owners of Manchester United), The promoter family of ArcelorMittal, etc were reportedly in the fray to buy these franchises.

This trend of investor interest isn’t limited to the IPL. I’ve watched the same pattern unfold in the English Premier League, Spanish La Liga, the NBA and many such sporting leagues. The question worth asking is why.

From Family Heirlooms to Media Empires

The shift began when institutional capital entered the picture, because institutional capital changes how things are run.

Once an institution enters, the same franchise stops being just a sports team. It becomes a media and entertainment company that tries to squeeze every Rupee or Dollar from its franchises. The athletes then are no longer just sports persons but full-fledged content creators, on the field and off it.

Broadcasting Rights - The Cash Cow

When you watch an IPL match, you’re watching a three and a half hour primetime slot reaching 50 Crore plus loyal viewers. With the arrival of OTT and generally falling attention span, traditional TV and Cinema have had to adapt themselves to remain relevant. But that is not the case with sports.

Sports are enjoyed the best when they are live. The fun of watching the highlights or the replay goes away as soon as you know the scores. You watch it live, or you miss the moment. Hence, this becomes one of the best avenues for advertisers and so broadcasting contracts for sports go for an astronomical sum

IPL broadcasting is the best example.

Source: Outlook

For the 2023–27 broadcast cycle, Disney and Viacom18 paid ₹48,390 crore collectively. Half goes to the BCCI; the rest is split almost equally across all ten franchises, win or lose.

Other leagues work similarly with minor quirks. The Premier League uses a 50:25:25 model — 50% split equally, 25% by league position, 25% based on televised matches.

These broadcasting deals are multi-year fixed contracts, negotiated years in advance. For the IPL, the BCCI controls how many franchises exist, and that number goes up very slowly. Winning is almost irrelevant to economics, and that is what makes the business even more valuable, steady cash flows despite the results.

The Shiny Thing for Owners

There’s also a vanity dimension, which makes investing in sports teams appealing. Because it changes how you’re perceived; by fans, by media, and by the public. “The owners of RCB” has a different ring to it than “a private equity firm.”

Another example is Saudi Arabia’s Public Investment Fund. They poured an estimated $6+ billion into Newcastle United, LIV Golf, the Saudi Pro League, Formula 1, and boxing since 2021. They say it’s about diversifying from oil and building sports tourism.

Celebrity owners understand this instinctively. SRK became the poster boy for KKR, and eventually for Kolkata itself. Vijay Mallya made RCB genuinely cool before anything else, he applied the same logic into Formula 1, brining India on the map of global motorsports.

The optics of sports ownership are not replicable by any other asset class.

The ROI Everyone is Aiming For

Ryan Reynolds and Rob McElhenney, two Hollywood celebrities bought a Welsh fifth-tier football club, Wrexham FC, in 2021 for £2 million (~₹25 crore). A documentary, a global social media following, and three consecutive promotions later, the club is valued at £350 million. Roughly 150x in three years.

Another good example is CVC Capital Partners who earned roughly a 75% return in four years after selling a 67% majority stake in the Gujarat Titans to Torrent Group.

On the other hand, when the Rajasthan Royals were founded, Lachlan Murdoch (Fox’s Executive Chairman and CEO, and News Corp’s chair) invested $2.3 million in 2008. But now he stands to pocket about $210 million from the sale, a 92.4x return.

Source: BCCI, Other Media Sources

Here’s What I think…

Institutional investors, corporates, and celebrity owners are not in this just for the game. They’re in it for stable, predictable cash flows from broadcasting and sponsorships, and the possibility of double-digit capital gains.

Sports has become the next alternative asset class. Like how art used to be back in the day. Except this one has millions of people watching every weekend, and none of them need any convincing to show up.

What makes it genuinely different from every other asset class: no war, no pandemic, no financial crisis has permanently stopped sports being played. The 2008 crash didn’t affect sports and neither did Covid in the longer term. And with most industries bracing for disruption from AI, sport stands out as one of the few that remains largely immune.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

The Crisis Nobody Is Talking About

Sun, 12 Apr 2026 06:42:56 GMT

I’ve been following the Iran war story like everyone else. Oil prices, supply shocks, inflation headlines. But something else has been happening in the background unrelated to the war.

Jamie Dimon, CEO of JPMorgan, the man who has steered the world’s largest bank through every major crisis of the last two decades, said publicly that what he’s seeing in financial markets (specifically the private credit market) today reminds him of the years just before 2008.

So in this newsletter, we have covered what is really happening in the US private credit market and what it can mean for us.

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Back to 2007-08

Before 2008, banks spent years lending aggressively. It packaged those loans into complex products, and sold them off to investors. Everyone assumed someone else had checked the risk. Meanwhile, oil surged from $20 in the early 2000s to over $130 a barrel in 2007-08.

It led to the following chain reaction: Rising Oil → Rising Inflation → Rising Rates → Borrowers Default → Imminent Crisis

Millions of people who had never heard the word “subprime” (a term for loans given to borrowers with weak credit histories) watched their savings halve.

And of course, it famously came to be known as the Subprime Mortgage Crisis which then turned into the Global Financial Crisis (GFC).

If you zoom out, the situation today has some similarities. Oil prices are rising because of the conflict in the Middle East, which is likely to push inflation higher. The US Federal Reserve (America’s central bank, equivalent to our RBI) may raise interest rates in response.

And once again, credit has expanded rapidly, but not inside regulated banks this time. It has grown in something called private credit.

What is Private Credit?

After the 2008 crisis, banking regulators around the world introduced stricter rules. This led to US Banks pulling back from lending to smaller, mid-sized businesses, which were seen as riskier.

That gap created an opportunity for a new class of lender: Private Credit Funds. These are investment funds run by large asset management firms, not banks, that raise money from big institutional investors (like pension funds, insurance companies, and family offices) and lend it directly to mid-sized businesses. Because they are not banks, they are not subject to the same regulations.

Here is an infographic explaining how Private Credit Works

For investors who put money into these funds, the returns looked very attractive, typically between 12-18% per year. The loans were also structured as senior secured debt, meaning in the event a borrower defaults (fails to repay), the lender has first claim on the company’s assets before anyone else gets paid. Over fifteen years, the private credit market grew from roughly $300 billion to nearly $1.8 trillion.

Who Did They Lend To?

A large portion of private credit flowed into software companies, particularly the SaaS (Software-as-a-Service) segment. Think of companies whose products you access online on a subscription basis, like project management tools, accounting software, or HR platforms.

And on paper, these looked like ideal borrowers. SaaS businesses have predictable subscription revenue, high customer retention (switching to a competitor is painful), and healthy profit margins. So private credit piled in. Lending to SaaS companies alone grew over 60 times in a decade, reaching $500 billion by the end of 2025.

Private Credit lent either directly to these software companies or to large investors (Private Equity players) who bought out these software companies. As competition heated up among private credit funds to deploy their capital, lending standards slipped. Loans got bigger, covenants (the conditions borrowers must maintain) got looser, and companies that might not have qualified earlier started getting funded.

The Crack Nobody Saw Coming

AI changed the equation for software companies completely.

Software businesses built their value on humans needing their products to do tasks be it coding, workflow automation, data processing and a lot more. When AI tools started doing those tasks itself, the business model of hundreds of these companies became fragile overnight.

The actual panic began in late January and early February when the new agentic AI tools were launched by Anthrophic. If AI could do most of the work that software firms were charging for, what happens to the revenue of those firms? And if the revenue dries up, can they repay their loans?

Once that uncertainty set in, investors who had put money into private credit funds started rushing to withdraw their investments.

Many of these funds had promised quarterly withdrawals. When fear hit, everyone tried to leave at once. The funds couldn’t sell their underlying loans fast enough. So they did the only thing they could. They capped withdrawals.

Is This Actually 2008?

Probably not. Private credit at under $2 trillion (5% of current US GDP) is far smaller than shadow banking before 2008, which had ballooned to over 200% of US GDP.

But here is the thing about finance. Everything is connected. A stress in one corner of the market rarely stays in that corner. It finds cracks, seeps through, and sometimes brings down walls that looked solid.

There is also another dimension to this. Private credit funds, which were once the exclusive preserve of pension funds and large institutions, have in recent years been sold to individual investors as well. The pitch was simple and compelling: high returns, low defaults, and a track record that looked near-pristine. Many retail investors, lured by these high yields, put significant savings into these products. If stress in the underlying loans deepens, it will not just be Wall Street firms taking the hit.

As the world tackles wars, high inflation, threat by AI, tariffs and so many other variables, the next few months would be a real test of time for these funds.

Let’s see how Private Credit passes this test.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

Is Copper The Next Silver?

Sun, 05 Apr 2026 07:37:00 GMT

In late 2024, we wrote about silver. The structural case was building quietly; solar, EVs, a persistent supply deficit, and the market hadn’t caught up yet, and when it did, we saw a sharp surge in silver prices.

Copper is one more commodity whose prices have surged sharply in the last couple of years.

But not many have copper in their radar as such. And almost nobody in India is talking about it.

In this newsletter, we unpack copper’s story and what the future holds for this ubiquitous metal.

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Dr Copper

Copper has an honorary doctorate from economists. It is called “Dr. Copper” for a reason, it’s the world’s most reliable barometer of economic growth. Its price is one of the most reliable barometers of global economic health, when demand rises, factories are humming and growth is happening. When it falls, slowdowns follow.

And copper is practically irreplaceable. It’s a physical input in everything: construction wiring, home appliances, power grids, solar farms, EVs, AI data centres, and defence systems. Over 70% of copper ends up in electrical applications. There is no substitute that works as well, as safely, or as affordably at scale.

Now here’s where the story gets interesting.

The Demand-Supply Equation

Right now, supply is roughly keeping up with demand, at ~28 million metric tons per year. That won’t last. Demand is about to accelerate sharply across four vectors simultaneously, while supply faces structural problems it cannot quickly fix.

The Demand Side: Various Forces Hitting at Once

Copper comes in many forms - wires, rods, bars, plates, sheets, strips, and tubes, and finds its way into Construction, Electronics, Transport, Power grids, Renewable energy, Electric vehicles, Defence, AI & Data Centres.

The total demand for copper is expected to rise by ~2.7% CAGR by 2040 with AI related capex the fastest growing segment.

Note: Core economic includes construction, cooling, appliances, fossil power generation, machinery and internal combustion engine (ICE) vehicles

And another force is emerging: humanoid robots. Even 1 billion units by 2040 adds 1.6 million metric tons of annual demand, bigger than India’s entire current consumption.

The Supply Side: A Chain with Many Weak Links

Before we talk about what’s going wrong, have a look at the supply chain here:

Mine → Concentrate → Smelter → Refinery → Cathode → Fabricator → End Product

Mining: Mining Copper Ore from the earth

Concentration: Ore is processed into a powder with 24–40% copper content

Smelting: Concentrate is heated to separate copper from impurities, producing blister copper (~98–99% pure)

Refining: Blister copper undergoes electrolysis to produce copper cathode — 99.99% pure

Fabrication: Cathode is shaped into wires, rods, tubes, sheets, and strips

End use: These reach EVs, solar farms, buildings, data centres, and defence systems

There are two sources of copper in this chain: primary supply (mined) and secondary supply (recycled scrap). Mining accounts for roughly two-thirds of total supply; recycling accounts for the rest.

The problem is that both are under pressure.

Mining: Ore grades are falling. Miners today dig twice as much rock for the same copper as 30 years ago. Building a new mine takes an average of 17 years from discovery to production. Two major mines recently went dark: Cobre Panamá (1.5% of global supply, shut since 2023) and Grasberg in Indonesia (world’s second-largest, hit by a mudslide in late 2025). Together, roughly 4% of global supply has simply vanished.

Smelting: Even if ore is available, it needs processing. China controls 40–50% of global smelting capacity, a single chokepoint the entire world depends on. Any disruption there ripples everywhere.

Recycling: Copper is infinitely recyclable without quality loss. But even aggressively scaling recycling covers only a third of 2040 demand. It helps but it cannot plug the gap alone.

Making Room for Copper in a Portfolio

We have a few options when it comes to getting exposure to copper. Physical copper isn’t a very practical investment option, given the substantial storage space needed to build meaningful exposure.

A Word of Caution

Note: The price above is $/Mt

From the COVID crash lows of 2020, copper has delivered roughly 150% growth, with the sharpest leg coming in the last eighteen months fuelled by a speculative buying spree as markets priced in US tariffs on refined copper imports and anticipated continued AI and grid infrastructure spending.

What we need to keep in mind is, metals can, and do, move on sentiment, tariff fears, and speculative flows which may be disconnected from logic. We saw it with gold. We saw it with silver.

A few banks like Goldman Sachs, Bank of America have given a target price for copper that is upwards of $13,500-$15,500 by 2035. From this point, the upside seems limited.

Rising copper prices is also an economic headwind. Copper is an input cost for infrastructure, construction, EVs, and electronics. When it gets expensive, everything built with it gets expensive too — and that feeds inflation. Higher copper prices are, in a sense, a tax on the very electrification trend driving them.

While the demand supply dynamics make a strong case for copper, the markets already seem to have priced in a lot of the positives. In my opinion, the best time to build a position in any metal is when no one is talking about it. During times when there is extreme pessimism. That’s when the structural story and the investment case aligns.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

Rupee at 95

Sun, 29 Mar 2026 07:38:37 GMT

One reader recently wrote asking about the rupee’s slide against the dollar. With the USDINR hovering around ₹95, I’m sure many would have this question - Why is the Rupee really depreciating? Is there anything wrong with our economy?

Before getting into what’s actually happening, one number is worth keeping in mind. When India moved to a market-determined exchange rate in 1992-93 after the liberalisation reforms, the rupee was at roughly ₹26 to the dollar. It’s now at ₹94. That’s a depreciation of about 3.7% every single year, on average, for over three decades. And for most of that time, the economy grew steadily.

So the rupee falling is not new. What’s worth understanding is why it happens, what it actually costs us, and whether ₹95 today is cause for concern or simply where things were always headed.

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Why Has the Rupee Always Fallen?

It really comes down to one simple idea: the inflation differential. India’s inflation, due to it being a developing economy, has historically run higher than America’s. When your prices are rising faster than your trading partner’s, your currency has to weaken to keep trade balanced. It’s not a crisis, it’s just how it works.

The good news is that this gap is closing. The India-US medium term inflation differential, which used to be 4-5%, is now closer to 2-3%. The rupee will continue depreciating, just more gradually than before.

Currency moves are quite complex. While there are many factors that impact the Rupee in the near term like capital flows, geopolitics and others, inflation differential is one of the most structural factors.

Why It Still Hurts, The Import Problem

India is a net importing country, and this is where rupee depreciation actually bites us as a nation.

We import roughly 85% of our crude oil needs. Last year, India’s oil import bill was about $137 billion. Every time the crude prices spike (like how they have during this war), our import bill rises. On top of that, India is one of the world’s largest importers of Gold and a significant importer of edible oils like palm oil from Malaysia and Indonesia.

Against that, our exports of goods don’t match up. This is what economists call the Trade Deficit (see chart below), we spend more dollars buying from the world than we earn selling to it.

Here’s where our Services exports and Remittances come to rescue.

Our Current Account Deficit (which is Trade Deficit minus Services and remittances) (see chart below) has shrunk dramatically over the last decade. India’s IT sector, BPO companies, and services exports bring in enormous amounts of foreign currency, quietly acting as a cushion against everything we spend on oil and gold.

Our Current Account Deficit is still negative, but with a growing economy and a strong thrust on increasing exports, the pain is reducing.

The Other Pressure: Foreign Investors Leaving

There’s a second force pulling the rupee down right now, foreign investors heading for the exit.

When US interest rates go up or when Indian equities start becoming less attractive due to high valuations or there are more lucrative opportunities elsewhere, investor money flows out of India. Simple as that.

This is the problem that we have faced in the last couple of years.

In 2024 FIIs pulled out Rs. ~3 Lakh Cr and the 2025 number was again ~3 Lakh Cr. In 2026, the number is already ~1.6 Lakh Cr.

This gets reflected in our Capital Account Flows (see chart below) which has been the lowest in the last 15 years.

When investors pull out from India, the demand for USD shoots up. And all that dollar demand puts pressure on the rupee. The RBI does step in sometime to defend the rupee by selling dollars from its reserves to slow the fall. With $698 billion in forex reserves in March 2026, we have a solid buffer. But every dollar spent defending the rupee is one less dollar available for everything else.

The Full Picture - Balance of Payment

Is the Rupee Cheap or Expensive Right Now?

This is where it gets genuinely interesting. Currencies, like stocks, have a fair value. Economists track this using something called REER, the Real Effective Exchange Rate. Think of it as a fair value meter that measures the Rupee against all our major trading partners, adjusted for inflation.

Think of it as a fair value meter for a currency.

Above 100 means the Rupee is overvalued, hurting exports. Below 100 means undervalued, helps exporters.

Source: BIS, FRED

The Rupee was arguably expensive on a real basis for large parts of 2024. As the Rupee depreciated from 83 in the start of 2024 to ~95 now, the REER has come down to around 94.8. This means the Rupee has moved from overvalued to slightly undervalued in real effective terms.

Summing it up

The Rupee at ₹95 is not the emergency it looks like on TV. The Middle east war has complicated things in the short term - higher oil prices mean a larger import bill, which puts direct pressure on the currency. But that’s a cyclical problem, not a structural one.

Structurally, the rupee was always going to get here. That’s what inflation differentials do over decades. And as India grows into a more developed economy, our inflation will gradually converge with the US, slowing the pace of depreciation over time.

The good thing is that our current account position, accounting for the size of the economy, is in far better shape than it was ten years ago. And on a fair value basis, the Rupee has become cheaper.

The noise around the Rupee is always louder than the actual signal. The signal right now says: things are difficult but not broken, and in some pockets, there’s genuine opportunity.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

How was The Manpasand Scam Uncovered

Sun, 22 Mar 2026 06:11:13 GMT

There is a saying among the investor community, “Revenue is vanity, profit is sanity, cash is reality.”

Everyone who has seen enough market cycles knows that the third part of that sentence is the one that actually keeps companies alive.

And yet, every quarter, most investors open an earnings report and go straight to net profit. Up 20%? Great story. Down 10%? Panic. Very few scroll to the page where the cash flow statement quietly sits.

In this newsletter, I will touch upon this 3rd piece of Financial statement, that gets the least amount of recognition.

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A Juice Company With No Juice

In 2016, a portfolio manager named Amit Mantri published a note flagging something odd about Manpasand Beverages, a fruit drink company that was, at the time, a darling of the mid-cap market.

But Mantri noticed one thing: cash flow from operations kept lagging behind reported profits. Not by a little. Consistently, year after year. The company was claiming to make money, but the cash wasn’t showing up where it should.

Three years later, the auditor Deloitte, after eight years of signing off on the books, abruptly resigned mid-year, which was one of the biggest red flags.

The MD and CFO were soon arrested. A forensic audit revealed that Manpasand had created 38 shell companies to run fictitious transactions through paper firms it had itself set up, faking its own sales and purchases in a loop.

The warning sign was visible in 2016. The stock peaked in 2018. Investors who read and understood the cash flow statement well had a two-year head start.

How the Cash Flow Statement Works

A cash flow statement has three buckets:

Operating: money generated from day-to-day business
Investing: money spent on or earned from assets and acquisitions (includes capital expenditure)
Financing: money raised or repaid through loans and equity

Investors care most about operating cash flow. It tells you whether the core business is generating real money.

The Red Flags Worth Knowing

Profits Growing, Cash Not Following
This is the most reliable signal. A healthy business converts most of its profit into cash over time. If profits keep growing but operating cash flow stays flat or falls, with no clear reason like a major expansion, something is worth investigating.

Receivables Growing Faster Than Sales
This is in a way linked to the first one. If revenue is rising but customers are taking longer to pay, that is a problem. It usually means sales are being pushed onto distributors who have not actually sold through yet, or in extreme cases, the sales are not real at all.

Supplier Payments being stretched
This one is very common. If a company holds back payments to vendors before the reporting period ends, its operating cash flow looks healthier than it actually is. If you notice a significant and sudden increase in accounts payable on the balance sheet, that’s your cue to dig deeper.

Shell Entity Shuffling
Like Manpasand, Enron, a US company famous for its accounting scam, created over 3,000 special purpose vehicles (shell companies). It sold assets to them, and booked the proceeds as operating income.

Operating Cash Flow Is Not the Full Picture Either

Even investors who track operating cash flow often stop there. They should not.

Businesses need to spend money on equipment, factories, and technology just to stay operational. Operating cash flow tells you what the business generated. It does not tell you what was left after maintaining and growing it.

The number that does is Free Cash Flow:

Free Cash Flow = Operating Cash Flow − Capital Expenditure

Consider an airline. IndiGo generates healthy operating cash flow. But aircraft, maintenance, and leases are expensive. Subtract that capex and the picture looks very different.

Now consider HDFC AMC. Minimal physical infrastructure, low reinvestment needs. Most of what it generates flows through as free cash.

That is why asset-light businesses tend to trade at higher valuations, the market is pricing in exactly this. When analysts say a stock is “expensive on earnings but cheap on free cash flow”, this is the comparison they are making.

(The companies mentioned above are just examples and are not recommendations)

There Is a Small Catch

Under SEBI rules, companies must publish quarterly results: revenue, profit, margins. But the Balance Sheet and the Cash Flow statement is required to be published only half yearly.

Profit numbers update every quarter. Cash flow data can lag by six months. And that delay is exactly why most investors stop paying attention to it.

The Final Word

To become a better investor, one should always compare net profit to operating cash flow, every year, for at least five to ten years.

A healthy business converts most of its profit into cash over time. If profits are growing but operating cash flow is flat or falling, with no obvious capital-heavy reason, that gap is a question worth asking.

The income statement tells you the story management wants you to hear. The cash flow statement tells you what actually happened. And that’s why it deserves more respect than it gets.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

Only 42% Of Crude Becomes Petrol

Sun, 15 Mar 2026 05:40:21 GMT

Oil is Not Just Fuel. It's Everything.

This morning, before you reached your office, you'd already touched crude oil more than a dozen times. The toothbrush in your hand is plastic, made from crude. Same for the toothpaste tube. The gym t-shirt you put on is mostly polyester, a crude derivative. The road outside, mostly bitumen, another crude product. The tyre on your bike or car is made from synthetic rubber, which also comes from crude.

The headlines talk about petrol prices. The real story runs much deeper.

Background First

In late February, the US and Israel launched strikes on Iran's nuclear facilities. Iran retaliated, and almost immediately, attention turned to the Strait of Hormuz, a 33-kilometre stretch of water through which roughly one-fifth of the world's oil supply passes.

Iran moved to restrict shipping through it, and oil prices surged sharply, touching nearly $100 a barrel. The situation remains heated, but the fact remains: when a single chokepoint comes under threat, the entire global oil supply chain feels it.

What Comes Out of a Barrel

A barrel of crude doesn’t just become petrol. About 42% becomes petrol (gasoline). Another 25% becomes diesel. The remaining third is where things get interesting.

Jet fuel for aviation. LPG for your kitchen cylinder (gas pipeline is CNG which is Natural Gas). Bitumen for roads. Lubricants for every machine with moving parts. And most importantly, naphtha, the piece many haven’t heard of.

Refineries convert naphtha into ethylene and propylene which are the building blocks of almost every plastic, synthetic rubber, and industrial chemical made today. That’s what connects a barrel of crude oil to your floor tiles, the paint on your wall, the polyester in your shirt, and the packaging around almost everything you buy.

Which Industries Depend on It, and How Much

When Stocks Get Punished More Than They Should

When crude spikes, markets react quickly. Sometimes faster than the actual business impact justifies. Stocks across paints, tyres, tiles, fertilizers, and textiles have sold off hard. Some of that pain is real. But history shows that markets tend to price in the worst case, not the most likely one.

For long-term investors, this creates an interesting pattern. When a company with genuine pricing power, a leading paint brand, a top ceramics player, sees its stock fall 15–25% because crude spiked, it is worth asking one question: Is this a business problem, or a cost problem?

Business problems are structural and take years to fix. Cost problems are cyclical.

Companies with strong brands, market leadership, and the ability to pass on costs over time have historically recovered their margins when input prices normalized. Companies in commoditized segments without pricing power tend not to.

Understanding which bucket a company falls into will help you invest in the right company at the right time.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

The ₹10,000 Weight-Loss Drug Just Lost Its Monopoly

Sun, 08 Mar 2026 06:41:03 GMT

March 2026. Semaglutide, the molecule behind Ozempic and Wegovy, the weight-loss drug, loses its patent protection in India this month which they kept for 20 years!

The legal wall that allowed one Danish company to charge ₹10,000–₹25,000 a month for a drug that costs roughly ₹1,500 to manufacture is coming down.

What follows could be one of the most consequential pharmaceutical events in the Indian healthcare history. To understand why, you need to know how we got here.

From Failure to a Trillion-Dollar Duopoly

For decades, the war on weight was mostly a story of failure and embarrassment. The only breakthrough came from an unexpected place: diabetes research. Scientists discovered a gut hormone called GLP-1 (Glucagon-Like Peptide-1), the signal your body sends after eating that says "enough now." Novo Nordisk built a drug to mimic it.

Early versions of Semaglutide (one of the GLP-1 drugs), from around 2006, showed modest results, weight loss of just 3-5%. That time weight loss was just a side effect of diabetes treatment, so it never came into limelight for weight loss. It was only when doses were pushed higher through the trials between 2021 and 2023 that the results became extraordinary: 15-18% average weight loss.

Eli Lilly followed with Tirzepatide (another GLP-1 drug), targeting two gut hormones instead of one, pushing that number to 22.5%.

These two companies now control the entire GLP-1 market. Novo Nordisk's Semaglutide which gets sold as Ozempic and Wegovy. Eli Lilly's Tirzepatide which gets sold as Mounjaro and Zepbound. Gross margins of 80-85%. A combined market cap that crossed a trillion dollars at peak.

According to PwC, 8% to 10% of Americans are currently taking GLP-1s, while 30% to 35% of Americans are interested in using them. Demand for prescriptions has been so high that suppliers often struggle to meet demand.

India's Missed Window, And Second Chance

In 2010, Zydus Lifesciences had quietly cracked something even Novo Nordisk was struggling with — an oral GLP-1 drug. Oral delivery is genuinely hard; these molecules tend to break down in the stomach before reaching the bloodstream. Zydus solved it, received Indian regulatory approval for phase 1 trials, and then shelved it.

Here’s What's Going To Happen!

The cost of international trials was too steep. But with the patent now expiring, Indian pharma gets a second look. India can capitalise on this opportunity through big Indian pharma giants like Biocon, Sun Pharma, Cipla, Dr. Reddy’s, Lupin & Zydus are already preparing to manufacture generic versions of GLP-1 drugs post-patent expiry.

The economics are compelling. Generics typically carry margins of 80-90%, and for patients, the cost of the drug is expected to fall by nearly half, making it accessible to a population that has largely been priced out until now. Prices are likely to fall from 10,000 per month to around ₹3,000-3,500 per month.

The Second Order Effects

India has over 101 million diabetics, the second highest in the world. At ₹3,000-3,500 a month , GLP-1 stops being a luxury and starts becoming standard of care. And when a drug moves from elite to mass market, the ripple effects go well beyond the pharmacy shelf. Consider this a sector-by-sector impact map.

That being said, India has always been the world's pharmacy for the developing world, making life-saving drugs accessible when Western pricing made them impossible.

But only if we play it strategically. China is already moving aggressively into GLP-1 generics, as both a low-cost API (API’s are the actual medicinal substance in a drug that makes it work) supplier and a direct competitor in Asia and Africa.

Indian companies that don't build API independence will find themselves squeezed from both ends. The window is real, but it won't stay open forever.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

Why Working Harder is Not The Answer

Sun, 01 Mar 2026 06:25:52 GMT

In 1988, Jim Simons started a quantitative hedge fund called Renaissance Technologies. He wasn't a trader or a banker. He was a mathematician who'd spent years breaking Soviet codes for the government.

Then Renaissance established the Medallion Fund along with other mathematicians. Average annual returns of 66% before fees over three decades.

Simons didn't outwork anyone. He had no better tips, no floor connections. What he had was code i.e. algorithms running 24 hours, finding patterns humans couldn't see, compounding quietly while he slept. He took his greatest advantage and multiplied it through systems that never tired.

It comes down to one word most people misunderstand: leverage.

The Fulcrum

In physics, a lever moves a large load with a small force, with a fulcrum in between.

The fulcrum is what makes everything else work.

Move it closer to the load and the same effort suddenly shifts ten times more weight. In life, the fulcrum is your positioning - the specific place where your skills meet an underserved problem that almost nobody else is occupying.

Simons' fulcrum wasn't mathematics. It was mathematics applied to financial markets, where nobody else was looking. That placement changed everything.

Most people spend their careers adding effort. Same lever, same position, and the load barely moves. The question isn't just how hard you push. It's where you're standing when you do.

Naval Ravikant, who co-founded AngelList and backed Uber, Twitter, and Notion early, breaks leverage into four types.

Before I get into these types of leverage, I want to clarify a little more about this word. Leverage has another meaning in finance: taking on debt to amplify returns. That kind of leverage is real, and it's risky. It's why people lose houses and why funds blow up. Here, I am not talking about financial leverage but some other forms of leverage.

Labour Leverage is the oldest kind. Henry Ford didn't build cars. He built a system of people who did. Today it looks like hiring or outsourcing to do things that used to eat your hours. Your time is finite. A system isn't.

Capital Leverage is Warren Buffett's entire game. Every rupee invested becomes a tireless worker that never sleeps and quietly compounds. Even ₹500 a month into a low-cost index fund, automated and started today, does something that feels almost unfair after twenty years. But Buffett's real fulcrum wasn't money, it was starting early and letting time do what time does.

Media Leverage is your reputation working while you aren't. Consider MrBeast, who reinvested every dollar he made on YouTube back into bigger videos for years before most people had heard of him. Today he runs one of the most-watched channels on earth, a chocolate brand, a burger chain, and a philanthropy operation — all powered by the same asset: an audience of hundreds of millions that follows him. The content was the fulcrum. Everything else followed.

Code Leverage is software working at near-zero marginal cost around the clock. WhatsApp was sold to Facebook for $19 billion with just 55 employees serving 450 million users. With the advent of AI, it has become easier to start building your own apps and systems - either for personal use or commercially.

Putting it all together

Stack these leverages together. That's where the real distance gets created.

Simons stacked code and capital, a fulcrum in a market nobody else was treating scientifically. Then there is Buffett, who stacked capital and media (Berkshire annual report which every investor wait more, and more). Most of us trade hours for income on a single lever, hit a ceiling, and assume we need to work harder. Usually, the fulcrum is just in the wrong place.

Leverage is not just about taking on debt. Leverage is taking what you already have; your skills, your savings, your name, your systems, and making it multiply.

Start small: automate one habit, publish one useful piece, build one repeatable system. Then stack another.

Over time, those quiet, compounding choices beat raw effort every time. That's what leverage really means. And now you can use it too.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

How Silver Rally Trapped Investors

Sun, 22 Feb 2026 05:39:44 GMT

There's a pattern that has repeated itself across every financial market, every decade, every generation of investors.

Back in 1637, when a single tulip bulb traded for more than a skilled craftsman's annual salary.

During the dot-com bubble, when companies with no revenue and no business model commanded billion-dollar valuations simply because they had ".com" in their name.

I saw the same thing when a jpeg image of a cartoon ape sold for $3.4 million.

The trigger changes. The asset class changes. Human behaviour doesn't, even when there is an ocean of information available now.

And there is only one reason why: Fear Of Missing Out! A.k.a. FOMO

But why am I talking about this suddenly?

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Let Me Give You Some Background

First In December 2024, we wrote about silver. It was trading at ₹85,000/kg. I said "Silver may be having its golden moment."

The thesis was simple: demand had been outpacing supply for years. Industrial use, solar panels, EVs, electronics, had surged 55% between 2015 and 2024. Total demand was up 14%. Supply was constrained. The fundamentals were there.

But at that time silver wasn’t being talked about much elsewhere. It barely made the news. It stayed rangebound until July 2025, and then it began to move.

Increasing global uncertainty and chatter about silver shortages started floating around.

As a result, Silver rose by 50% by Diwali and then corrected a little.

Since then, we saw an extraordinary rally in Silver where it touched ₹4.2 lakh at its peak in January 2026 (almost doubling from its Diwali highs). A 270% rise in 13 months.

During this rally, I watched the one predictable investor behavior that ultimately hurts their wealth.

📊 Question: In 1979-1980, silver prices surged 700% before crashing. Who was behind the attempted market corner?

A) The Rothschild family

B) The Hunt Brothers

C) George Soros

D) Warren Buffett

Fear of Missing Out

As silver’s price rose, so did the hype around it.

WhatsApp forwards on why silver is a must have in your portfolio. YouTube videos with confident presenters pointing at charts.

Suddenly, everyone had a thesis and everywhere there was chatter about silver

And as silver crashed, people stopped talking about it. No more media coverage. No more discussion on gold & silver.

The pattern is always the same: Rising prices → More talk → More FOMO → More volume → Peak → Silence.

This is what we saw on our platform as well. Investments in silver spiked as prices rose and as they corrected, the volumes normalised.

And I’m sure a similar pattern played out across other platforms and in other hyped products.

We saw this with crypto in 2021. Small caps in 2017 and 2024. And so on.

So, this story isn’t just about silver.

Because the asset changes. The story and human behaviour doesn't.

What Can We Even Do About It?

The easy answer: FOMO is the most human emotion of all. Despite the plethora of information, intelligence, and evolution, this pattern keeps repeating.

There’s no universal antidote to this. But you can avoid falling into this trap, or at least minimise the damage, by practicing a few fundamental things:

Be countercyclical. When everyone is shouting, pause. Euphoria is rarely the beginning of the move, it’s usually towards the end.
Stick to your plan. Create your asset allocation according to your goals and stick to it with maybe small deviations.
Discipline through SIP. Small, consistent investing reduces the temptation to “go all in” at the top. It replaces emotion with process.

Because in markets, you don’t win by being the fastest. You win by being the most consistent.

The crowd will always find the next silver.

Your job is simply to not be in the crowd when it does.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

Why India Is Back in The Chip Race

Mon, 16 Feb 2026 08:39:13 GMT

India’s semiconductor story has, in many ways, been a story of a lost decade — perhaps even two.

In the 1970s and 80s, India had credible hardware capability. We built mini-computers, and ran strong public-sector labs. But over time, we pivoted sharply to software and IT services, while others doubled down on chip manufacturing and supply chains.

Through the 2000s and 2010s, several revival attempts were announced, but most never materialised. Each setback dented credibility. By 2020, India was one of the world’s largest semiconductor consumers, producing virtually none at home.

What’s different now?

The introduction of the Indian Semiconductor Mission (ISM): $10 billion in structured funding, direct PMO oversight, and active engagement with global chip majors.

What India Is Trying to Build

A semiconductor industry is not a single factory. It is an intricate ecosystem where multiple layers must function in harmony. India’s strategy reflects this reality by targeting the entire value chain:

Chip Designers: The architects of circuits Fabrication Plants (Fabs): Facilities that manufacture chips from silicon wafers ATMP (Assembly, Testing, Marking, Packaging) & OSAT (Outsourced Semiconductor Assembly and Test): Packaging and testing operations Suppliers: Providers of specialized materials, gases, and precision equipment

The approach is pragmatic: begin with commercially viable, established technologies and gradually move toward cutting-edge nodes.

I have covered the entire value chain in detail later in the newsletter.

Indian Semiconductor Mission

ISM 1.0: Breaking the Inertia

Launched in December 2021 with an outlay of ₹76,000 crore, ISM 1.0 aimed to break India’s long-standing “zero-fab” barrier by offering fiscal incentives to attract global manufacturers.

While early progress was slower than expected, largely due to execution challenges and logistics around specialized equipment, momentum improved once credible players with strong balance sheets entered.

As of early 2026, 10 major projects with investments exceeding ₹1.6 lakh crore are underway. Key milestones include:

Micron Technology: ATMP facility in Sanand, Gujarat
Tata Electronics + PSMC: Fab in Dholera, Gujarat, targeting 28nm chips
Tata Semiconductor Assembly and Test (TSAT): Assembly unit in Morigaon, Assam
CG Power + Renesas: OSAT facility in Sanand

Four of these plants — Micron, Tata (Assam), CG Power, and Kaynes are slated to begin commercial production in 2026, marking a historic shift from policy to reality.

ISM 1.0 demonstrated an important lesson: capital is necessary, but not sufficient. Building semiconductor capability demands mastery of complex logistics — clean rooms, ultra-pure materials, and sensitive supply chains.

More importantly, these investments signaled that India is now willing to share the risks of this expensive and cyclical industry.

ISM 2.0: From Assets to Ecosystem

If ISM 1.0 focused on physical infrastructure, ISM 2.0 emphasizes resilience and depth.

Policymakers recognized that factories remain vulnerable when every chemical, component, and design tool is imported. The next phase therefore shifts attention toward strengthening domestic linkages.

What changes under ISM 2.0?

Supply Chain Localization: Encouraging domestic production of specialized materials and equipment
Design-Led Growth: Supporting fabless companies and Indian IP creation
R&D and Skilling: Expanding focus beyond capital expenditure

This evolution reflects a maturing strategy: not just building facilities, but building capability.

The Semiconductor Value Chain

Note: The names are illustrative and not exhaustive.

Think in Decades, Not Quarters

Two structural shifts are working in India’s favour.

First, geopolitics. Global supply chains are being diversified, and companies are actively seeking alternatives to single-country concentration.

Second, cost arbitrage in engineering talent. India has one of the world’s largest pools of chip designers. That makes design, and parts of manufacturing support, more competitive here than in many developed markets.

Politics, talent, and incentives, that combination creates a genuine opportunity window.

This is not a short-term trade. Semiconductor capability is built layer by layer over 15–20 years.

Success will not be measured by one announcement or one subsidy package, but by accumulated capability over time.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Also, if you have any topics that you would like us to cover or any other feedback, do write to us at connect@incredmoney.com

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

Will AI Kill Jobs, or Create More?

Sun, 08 Feb 2026 05:38:35 GMT

Last week’s market reaction said more about our fears than about technology itself.

News around Anthropic’s new Claude plugins spooked global IT stocks. The idea that AI agents can now automate large parts of knowledge work triggered a familiar worry: are jobs next? The selling was swift, and the narrative quickly turned dark.

Closer home, the anxiety feels even more real. Companies like TCS, Infosys and Wipro, which once hired fresh graduates in the tens of thousands, have cut back sharply. Automation, efficiency drives, and AI-led delivery models are clearly reshaping how IT services operate.

At first glance, it looks like a straight line:

AI improves productivity → fewer people needed → fewer jobs.

But history tells us it’s rarely that simple

There’s a concept from economics called the Jevon’s Paradox. Back in the 1800s, when steam engines became more efficient, people expected coal usage to fall. Instead, coal consumption increased. Cheaper energy made more industries viable, more applications possible, and demand exploded.

Efficiency didn’t shrink the economy. It expanded it.

That is what is called Jevons Paradox: That improving efficiency of resource production leads to an increase in resource consumption.

We’ve seen this pattern repeat. ATMs were supposed to kill bank teller jobs. They didn’t. Banking became cheaper, branches expanded, and teller roles evolved.

Computers didn’t destroy office work; they created software, IT services, digital marketing, cybersecurity and entire industries that didn’t exist before.

It makes me wonder if AI fits this pattern far more than we realise?

Yes, certain tasks will disappear. Routine coding, basic testing, repetitive back-office work — these are already being automated. That’s the uncomfortable part. But cheaper intelligence also unlocks new demand. New products. New services. New problems worth solving.

Think about what’s already emerging:

AI infrastructure, data centres, model monitoring, AI safety, compliance, industry-specific AI tools, human-in-the-loop systems, education and reskilling platforms. None of these were mainstream job categories a decade ago.

In many departments, tasks that once died with “we don’t have the time” are now replaced with “we can do this, and a hundred more.” That shift creates pressure, but it also creates possibility.

But that also brings me to another point.

Will The Rise of New Jobs & Productivity Lead to Growth in Wages?

Here’s where I’m more cautious.

During the Industrial Revolution (Steam Engines were in fact the key drivers of the Industrial Revolution), Friedrich Engels observed something else at play.

Machines made workers far more productive, allowing factories to produce much more than before. However, wages for the average worker stayed stagnant for many years.

While labourers struggled to maintain their living standards, industrialists benefited the most from these productivity gains. This gap between rising productivity and stagnant wages is known as the Engels pause, named after Friedrich Engels.

While we agree AI is boosting productivity through automation (PwC’s Global AI Jobs Barometer shows companies with high AI adoption have seen productivity gains of up to 27%); Wages may not rise at the same pace. A Forbes analysis suggests 50–70% of wage stagnation since 1980 can be linked to automation.

So while AI may create new sectors and new roles and boost production ten folds, the harder question remains…

Who captures these gains?

Will profits be increasingly concentrated at the top, especially the one responsible for the architecture of AI? How these gains from AI get distributed will play an important role in whether this technology will create prosperity or worsen inequality.

I hope this gives you a clearer sense of where we might be headed. Not just from an investment lens, but also for career choices and life decisions more broadly.

And if I’m being honest, the consequences of AI aren’t easy to gauge. Whether it ultimately works for good or creates deeper challenges is something only time can tell.

Do let me know your thoughts!

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.

The Most Expensive Mistake Countries Make

Sun, 01 Feb 2026 05:33:16 GMT

Imagine winning a massive lottery jackpot tomorrow. Millions of dollars land in your bank account (after taxes, assuming today’s Union Budget is kind). You quit your job, buy a mansion, and start spending lavishly.

At first, it feels like a dream. But soon, your skills get rusty because you aren't working. Your old friends drift away because they can't relate to your new lifestyle. You rely entirely on that pile of cash. If that money suddenly runs out or loses value, you are left with no job, no skills, and a lifestyle you can no longer afford.

Believe it or not, entire countries go through this exact same problem. It’s a phenomenon economists call Dutch Disease.

Venezuela's economic crisis, despite its great natural resources, prompted me to explore this further and this is how I stumbled upon this interesting topic.

Why is it called "Dutch Disease"?

It sounds like a medical condition, but it is actually an economic one.

The term was coined in 1977 by The Economist magazine to describe what happened to the Netherlands in the 1960s. The Dutch discovered a massive natural gas field in the North Sea. It seemed like a blessing! They exported the gas and money flooded in.

However, as they sold gas to the world, the value of their currency skyrocketed. This made their other products, like manufacturing and agriculture, too expensive for other countries to buy. Factories closed, unemployment rose, and the economy actually got worse despite the new wealth. The "blessing" had become a curse.

Why Do Countries Fall Into This Trap?

It happens because of a sudden imbalance. When a country finds a huge resource (like oil, gold, or gas), two main things usually happen:

Currency Spike: Foreign countries rush to buy the resource, boosting the local currency's value. This makes other exports (like cars or crops) very expensive and uncompetitive globally.

Laziness & Neglect: The government and businesses focus all their energy and money on that one "cash cow" resource. They stop investing in education, technology, or manufacturing.

Eventually, the country becomes a "one-trick pony." If the price of that resource drops, the whole economy collapses because there is no backup plan.

The Victims: Countries That Got Trapped

Many nations have struggled with this. Here is a look at a few notable examples:

The Survivors: Escaping the Trap

Is it possible to find treasure and not ruin your economy? Yes, but it requires incredible discipline.

Countries like Canada, Saudi Arabia, UAE, Norway and Botswana have managed their resources reasonably well. Even the Dutch got out of this trap sooner than later.

How Norway Did It

When Norway found oil, they knew about the Dutch Disease. They decided on a bold strategy: Don't spend the money.

Instead of spending their oil profits on tax cuts or fancy projects, they put the money into a massive savings account called a Government petroleum fund, later known as the Government Pension Fund.

Investing Abroad: They invested this money in companies all over the world, not just in Norway. This kept their own currency stable.

Saving for the Future: They only spend the interest earned from the fund, not the fund itself.

Today, Norway’s pension fund is worth over $1.6 trillion. They turned a temporary resource into permanent wealth for their future generations.

Conclusion

Dutch Disease teaches us that having resources isn't enough; you need to manage them wisely. It is the difference between the lottery winner who goes broke in five years and the one who invests the money to build a secure life. Wealth without work or diversification is often just a trap in disguise.

If you enjoyed this newsletter, feel free to share it with your friends and family using the link below.

Till the next time,
Vijay
CEO - InCred Money

P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.