Otto Money Newsletter - 24 Jan 2026

Dear Reader,

The markets witnessed the biggest drop in weeks and have retracted to Oct ’25 levels. Nifty is below the 200 DMA signalling short term weakness. FIIs have been net sellers, Q3 results have been tepid, rupee has plunged to fresh lows, tariff wars have wiped off ₹16 lakh crores from the market capitalisation. Gold (~17%) and silver (~50%), have soared higher in the last one month.

Geopolitical tensions - from Venezuela and Greenland to Iran and diplomatic brinkmanship continue to dominate the headlines. As world leaders debate and discuss at Davos, the ripple effect is also felt on the stock market. When fear and anxiety takes over, it is process and discipline that helps one stay on track. Seasoned investors will agree that volatility, by itself, is not bad - it’s how we react to it, that makes it risky. Being aware of one’s financial situation is the first step towards navigating such periods with confidence. Our portfolios continue to be defensive, outperforming benchmarks during this fall.

Amid market oscillations, one of the most important structural reforms has begun to reflect in corporate results. The new Labour code, which has consolidated 29 codes into 4, aims to simplify compliance and enhance benefits for employees. The most impactful change has been the broader definition of wages that has increased the provisioning for gratuity, provident fund and other statutory benefits. The higher cost base is visible on the Q3 earnings. We picked a cross-section of companies for analysis: in IT companies, where personnel cost is high, the impact is pronounced ~ nearly ₹ 5000 crore of additional provision across a handful of the companies. In Rallis, a manufacturing company, the wage code provisioning has wiped out the profits.

Acknowledging and provisioning for liability is compliance. What we do with the funds is strategy. If the capital sits idle on the balance sheet or in low yield deposits, it will suffer inflation and future cash flow strain. Companies should look at options of deploying it more efficiently. One approach could be to get professionals to manage the fund. Another, more pragmatic approach, will be to channel the funds to a NPS or EPFO structure. In this way the companies will also be ready to meet their obligations when the time arises. In investment parlance, this is called asset liability management - meaning assets are managed in such a way that the gap with liabilities is minimised. This is a complex topic and we will not bore you with the details here.

Shifting gears, at Wealth Beacon, we are evolving. This is our last newsletter and going forward, we will share insights on LinkedIn, YouTube , Instagram and X. We are also approaching a significant milestone - the formal launch of Otto Money. We believe AI will fundamentally change how individuals engage with their financial lives and Otto Money is our response to that transformation.

In the next few days, we will share previews and insights ahead of Otto Money’s formal unveiling.

Click below to read our Market Update - a compilation of important metrics for you.

Warm Regards,

Wealth Beacon Team

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