Indian equity markets witnessed significant declines on Thursday, with the NSE Nifty 50 index dropping by over 380 points to settle at 23,063.10, down 1.64%. According to CNBC-TV18, the benchmark index broke through successive support levels at 23,300 and 23,200, extending opening weakness into a broad-based sell-off. From a technical perspective, immediate support for the Nifty is placed at 23,000, below which the index could fall towards 22,700, while resistance is positioned at 23,200, as noted by Rupak De, Senior Technical Analyst at LKP Securities.
PB Fintech experienced a sharp 32% plunge on its market debut following the Insurance Regulatory and Development Authority of India's (IRDAI) proposed overhaul of insurance distribution rules. As reported by CNBC-TV18, the company has raised significant concerns over the government's proposed insurance sector reforms, describing the consultation paper as "quite extreme" during an analyst call. The entity expressed fears that the proposed changes could seriously impact revenue from its general insurance business and warned that larger agents may not find it lucrative to sell insurance at the proposed rates. Almost 90% of PB Fintech's operating revenue is earned through insurance commission, with the company making ₹6,089 crore under this head in fiscal 2026 - representing ₹6,794 crore in total revenue from operations. Shares of PB Fintech fell 32% on Day One to ₹1,210 on the BSE, while the company lost around ₹31,000 crore in market cap during Thursday's trade.
IndusInd Bank faces significant exposure to the proposed insurance commission cuts, with its commission pool standing at ₹1,000 crore in FY26 (18% of FY27 normalised profit), according to Jefferies analysis. The brokerage warns that a 30% reduction in bancassurance fee income could impact profits by around 5%, as the majority of fees come from new sales including credit-protect products. IndusInd Bank's RoA at the end of Q1FY27 stood at 0.78% (annualised), while it was 0.45% at the end of FY26, with the bank's RoA having slipped into negative territory in Q2FY26. Jefferies estimates that a 10% reduction in new-business commission rates could translate into a 10-12% decline in earnings for distributors such as PB Fintech and Turtlemint. The regulator has proposed lower commission limits for distributors that sell products from several insurers, with sharp cuts across health, term and motor insurance.
Axis Bank and HDFC Bank are more exposed than ICICI Bank and Kotak Mahindra Bank to the proposed changes because of the larger contribution of insurance fee income to their revenue and profit before tax. According to Macquarie's analysis, Axis Bank's bancassurance fee income rose to 2.4% of revenue in FY26 from 2.1% in FY25, while its contribution to profit before tax increased to 12.5% from 9.2%. For HDFC Bank, insurance fee income accounted for 1.9% of revenue and 7.3% of PBT in FY26, compared with 1.8% and 7.1% respectively a year ago. By comparison, insurance fee income contributed 0.2% of revenue and 0.6% of PBT at ICICI Bank in FY26, while the corresponding figures for Kotak Mahindra Bank were 1.6% and 5.8%. At SBI, the contribution stood at 0.5% of revenue and 2.6% of PBT. According to IIFL Research, bancassurance contributes 26% of total fee income at Bandhan Bank, followed by 20% at AU Small Finance Bank, 17% at IndusInd Bank, and 15% each at Axis Bank and Yes Bank.
The domestic stock market is expected to open lower on Friday, with GIFT NIFTY futures suggesting the NIFTY50 index will open 21 points lower. According to reports from CNBC-TV18, this negative opening follows Thursday's market sell-off, with shares expected to remain in focus on Friday. The market attention will be particularly on stocks like ESDS Software Solution, Purple Style Labs, Wheels India, Waaree Energies, Dr Lal PathLabs, Sterlite Technologies, LCC Projects, FSN E-Commerce Ventures Nykaa, and JSW Cement which are expected to be in focus during today's trade. Several companies, including JSW Cement, faced regulatory scrutiny amid ongoing market fluctuations.
