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1. Vishal Mega Mart:

Motilal Oswal retains its ‘Buy’ call on this retail store chain with a higher target price of Rs 170 per share, an upside of 24.3%. Despite an 8.2% drop in the stock price last quarter, analysts Aditya Bansal and Avinash Karumanchi see strength in the stock. Vishal Mega Mart benefits from its diverse product mix, budget-friendly starting prices, major contribution from its own brands, and an efficient cost structure. These give it an edge over both offline and online value competitors.

Management remains confident in achieving double-digit same-store sales growth in FY26, driven by its unique offerings, with around 75% of revenue from its own brands, entry-level pricing, and a loyal customer base. Analysts add that the company's focus on offering premium products helps it capture a larger share of customer spending, particularly during festive seasons.

Bansal and Karumanchi point out that South India's profitability matches the national average, despite lower sales volume, thanks to strong demand for apparel. Encouraged by this performance, the company plans to open more stores in South India. They project Vishal Mega Mart will achieve a 20% revenue CAGR and a 30% net profit CAGR from FY26-28.

2. Waaree Energies:

Emkay reiterates its ‘Buy’ call on this solar module manufacturer, with a target price of Rs 4,260, an upside of 37.6%. Its share price has fallen 2.8% over the last month and 10.4% over the three months. Waaree's planned $30 million investment in United Solar Holding (USH) drives this recommendation. It grants Waaree access to a 1 lakh tonnes-per-year polysilicon plant in Oman. This supports partial backward integration in its solar supply chain.

The Oman plant offers cost benefits, lower energy expenses, and favourable trade terms with markets such as the US and India. This will help Waaree meet the 10-gigawatt wafer-ingot demand for its Nagpur facility. Management expects the plant to begin operations soon and reach full capacity within a year. This ensures long-term supply security and reduces reliance on Chinese polysilicon.

Waaree also added 5.1 gigawatts of module capacity in Gujarat during Q3, strengthening its domestic manufacturing. Analysts Sabri Hazarika and Arya Patel state that the USH investment will enhance scale, integrate the supply chain, and support global expansion. They expect this step to improve margins gradually. They also see Waaree well positioned to profit from rising global solar demand and clearer supply prospects.

3. Lumax Auto Technologies: 

ICICI Direct reiterates its ‘Buy’ rating on this auto parts & equipment producer with a target price of Rs 1,800 per share, an upside of 14.3%. Analysts Shashank Kanodia and Bhavish Doshi see benefits from the company’s strong position in the passenger vehicle (PV) ancillary segment, gains from premium products, and a robust order book.

Management notes that the PV segment generated 55% of the company’s sales in H1FY26, boosted by the acquisition of PV interior supplier International Automotive Components (IAC) India. Analysts add that this acquisition gave Lumax Auto’s product range a boost, particularly in plastic interior modules. It has also expanded business with original equipment manufacturers (OEMs) such as Mahindra & Mahindra.

With a 40% share of EV platforms in its Rs 1,360 crore order book and increasing content per vehicle, the analysts believe the company is well positioned to profit from volume growth and premiumisation among leading OEMs. Kanodia and Doshi write that GST 2.0 reforms will drive two-wheeler segment growth, led by volume recovery. They expect the company to deliver an 18.1% revenue CAGR and a 30.6% net profit CAGR from FY26-28.

4. Aditya Infotech: 

ICICI Securities maintains its ‘Buy’ call on this IT networking equipment manufacturer, with a target price of Rs 1,800 per share, a 15.9% upside. The stock has dropped 6.9% over the past month. Analysts Aniruddha Joshi and Manoj Menon believe Aditya Infotech will continue to gain market share, driven by stronger brand recognition and expanded manufacturing.

Management highlights increased brand-building investments. This includes expanding CP Plus Galaxy stores, which are their specialised outlets for advanced surveillance products, and more advertising. Analysts add that this brand push is crucial to attract consumers and support premium product offerings. The company's partnership with Qualcomm for AI-enabled video security solutions has differentiated its products and improved customer retention.

Joshi and Menon believe the company's planned capacity expansion in Kadapa and a new North India manufacturing unit will improve service speed, cut logistics costs, and enable faster market entry. Analysts add that successful partnerships with semiconductor players will boost product performance and long-term cost efficiencies. They expect the company to deliver revenue and net profit CAGRs of 24.3% and 65.2%, respectively, from FY26-28.

5. Shriram Finance: 

Axis Direct reiterates its ‘Buy’ call on this NBFC, with a target price of Rs 1,125, an upside of 17.5%. Analysts Dnyanada Vaidya and Abhishek Pandya cite MUFG Bank's planned strategic investment as the main driver of this positive outlook. MUFG intends to buy a 20% stake for roughly Rs 841 per share via a preferential allotment. 

This Rs 39,618 crore deal marks India's largest foreign direct investment in its financial services sector. The capital infusion will strengthen Shriram Finance's fundamentals. It is also expected to fuel faster growth in areas like new commercial vehicles and MSMEs. Management believes the partnership will boost capital reserves, simplify fundraising, and improve governance. MUFG-appointed directors will help guide the company's strategy.

Vaidya and Pandya expect lower funding costs, possibly due to a credit rating upgrade. If the deal closes in FY27, Shriram Finance's net worth could nearly double. They foresee a 17% CAGR in assets under management from FY26-28 and margins improving by 80-90 basis points in FY27-28. Although equity dilution might limit return on equity, analysts predict overall returns will rise due to better profitability.

Note: These recommendations are from various analysts and are not recommendations by Trendlyne.

(You can find all analyst picks here)

The US stock market in 2025 was a season of plot twists and jump scares. In April, the S&P 500 index corrected by over 10% due to the Trump tariffs. By June, it ripped to fresh highs after President Donald Trump softened his stance and investors piled headfirst into anything even remotely AI-related. So far in 2025, the index is up by more than 17%, reaching a level of 6,878 by December 23. But more than half of those gains came from a few mega-cap giants worth $200 billion or more.

This sets the stage for a very different 2026. According to David Kostin of Goldman Sachs, the easy phase is over. The era of rising multiples is ending, and the next leg of the bull market will lean less on hype and more on hard earnings growth.

Not everyone is convinced returns will be exciting. Savita Subramanian of Bank of Americawarns that slowing share buybacks could cap S&P 500 gains at a modest 4% next year, with a target price of 7,100.

Jean Boivin of BlackRocksays, "The market is moving from a policy-driven phase to a productivity-driven one." He suggests that as capital spending translate into results, the focus must move toward infrastructure.

Let’s look at four trends that will shape 2026 returns.

1. The AI bill comes due next year

For the past three years, markets treated AI like a free lunch. Productivity gains were assumed, and valuations ran ahead of reality. By 2026, hyperscalers are expected to spend over $527 billion on capital expenditure, sharply higher than earlier estimates of $465 billion. The money is pouring into chips, data centers, and power-hungry infrastructure, to keep chatbots like ChatGPT, Gemini, and Claude running smoothly, and to make sure they’re ready to handle a (highly disruptive) shift of economic activity from humans to machines.

The final bill may run into the trillions. The financing is coming from venture capital, debt and, lately, unconventional circular financing arrangements that have raised eyebrows on Wall Street.

A flood of debt sales from Big Tech could weaken the credit market on both sides of the Atlantic. Wall Street underwriting to fund AI and data centers is soaring, but would-be creditors are starting to worry about being compensated for the risks of a bubble. Tech firms are expected to float as much as $1.5 trillion of debt by 2028.

Morgan Stanley warns that this could push up borrowing costs as investors may demand higher returns to absorb the supply. KKR’s Raj Agrawal says, “Some of these investments are likely not going to work out, that’s just the reality when you have this much capital moving this fast.”

The gap between infrastructure spending and revenue generation is increasingly visible. Many companies funded AI expansion with debt, introducing new balance-sheet risks. Debt-funded AI spending is widening the divide between leaders and laggards, pushing investors away from firms where capex growth is not matched by cash flow. This led Meta to shift its focus from open source models to money-making ones.

2. Concentration risk rises as capital crowds into top companies

Beneath the noise is a structural problem: extreme concentration. Investors have crowded into “one dominant stock per sector” in search of safety. Nvidia in semiconductors and Eli Lilly in healthcare are prime examples. While fundamentals remain strong, overcrowding amplifies downside risk due to expensive valuation compared to its peers.

Dubravko Lakos-Bujas of JPMorgan says, “markets are becoming unbalanced, with too much money flowing into just a few popular stocks. When many investors pile into the same names, prices move more sharply." It also makes risk harder to manage, because in stressful periods, heavy selling can quickly push prices down.

2025 was “Trump 1.0 on steroids,” said Keith Lerner, chief investment officer and chief market strategist at Truist Advisory Services Inc., adding that he can’t recall another period when US political decisions triggered this much market volatility.

3. AI’s appetite for power is raising electricity costs

The power bill shock isn’t over. As the US heads into 2026, electricity prices are moving higher. Throughout most of the year, US electricity bills rose faster than overall consumer prices. By September 2025, electricity bills were up 5.1% YoY, compared with a 3% rise in broader consumer inflation.

Retail power rates jumped 7.4% in September 2025, pushing prices to a record 18.1 cents per unit, the steepest increase in nearly two years. With fuel costs climbing and demand staying firm, power bills for homes, transport and businesses are likely to rise further next year.

Electricity demand is rising far faster in Texas and the Mid-Atlantic than the national average. While US power sales are expected to grow about 2.2% annually, Texas demand could jump around 11%, driven by data centres, factories and crypto mining, while PJM demand is set to rise 4% in 2026, led by Northern Virginia.

Data center expansion is the primary driver. Global electricity consumption by data centers is projected to grow 17% through 2026. “AI’s surging power demand growth will be testing grid limits,” says Eduard Sala de Vedruna of S&P Global Energy. Utilities are being forced into large-scale infrastructure upgrades to meet this demand.

4. Diversification beyond mega-cap firms

The mega-cap firms now make up more than half of the S&P 500’s total value, a historic high. However, the market’s spotlight is shifting toward the “enablers” powering the AI boom. Industrial firms and semiconductor supply chains that provide copper, power equipment, cooling systems, and grid hardware are unglamorous but indispensable inputs to the AI and electrification buildout, and many still trade at far more reasonable valuations.

As a result, leadership is expected to rotate toward cyclical and value-oriented sectors. Solita Marcelli of UBS says, "Financials and healthcare are providing a broad foundation as policy uncertainty fades." Mike Wilson of Morgan Stanley adds that investors should favor "industrials and real assets" to capitalize on a "run-it-hot" economy focused on domestic manufacturing.

Semiconductor onshoring is driving a multi-year investment cycle. New US manufacturing plants are coming online, boosting demand for construction and engineering services. The push to make chips at home is driven by national security concerns flagged by the Trump administration. Because these factories are seen as critical infrastructure, spending is likely to continue even if the broader economy slows.

Thanks to these shifts, Michael Wilson of Morgan Stanley expects “market breadth to improve” as leadership shifts toward Financials and Industrials, describing 2026 as an “early-cycle” bull phase for the broader index.

The next phase of returns may favor companies solving physical bottlenecks. Power, cooling, and grid infrastructure providers are gaining attention. Denise Chisholm of Fidelity notes that “rotation and small caps” could outperform as leadership widens. In this environment, diversification is no longer just protection, but a source of opportunity.

The transition from 2025 to 2026 marks the end of the "imagination phase" of the AI bull market and the beginning of the "execution phase." While the previous year was defined by geopolitical plot twists and a narrow chase for mega-cap safety, the coming year will demand a different approach.

1. 360 One Wam:

This capital markets company rose 1.5% on December 18 after Motilal Oswal reiterated its ‘Buy’ rating with a lower target price of Rs 1,350, implying an 18.5% upside. 360 ONE operates in wealth and asset management, catering to high-net-worth individuals (HNIs), ultra-HNIs, family offices, and institutions.

Motilal Oswal’s view is driven by India’s expanding base of people with fat wallets – the HNI and UHNIs, which benefits 360 ONE. More than 70% of its revenue comes from recurring fees, which provides earnings stability. Its asset management business is expected to grow its AUM to around Rs 1.3 lakh crore by FY28. Overall, the company’s consolidated revenue and net profit are expected to grow at around 21% CAGR through FY28.

The company’s recent deals have added scale and widened its range of services. The ET Money acquisition in June 2024 brought in about Rs 2,350 crore of assets and strengthened its digital reach. Broking firm B&K Securities, acquired in early 2025, adds roughly Rs 45 crore per quarter in transaction revenue. The UBS Wealth India deal contributed over Rs 5,200 crore in assets and improved access to offshore products.

The expansion is showing up in the numbers. In Q2FY26, revenue rose 32% YoY to Rs 813 crore, mainly due to higher recurring income. Net profit grew 28%, though margins slipped slightly because of higher technology spending and the impact of recent acquisitions.

CEO Karan Bhagat said, “We expect net inflows of 10–12% to continue over the next two years, supported by stable markets and higher productivity from new relationship managers. Transaction and brokerage revenue should grow 8–12%, even as the focus shifts to recurring income.” He added that the HNI business is on track to break even by Q3–Q4 next year as client additions and monetisation improve.

2. Indraprastha Gas (IGL):

The stock of this non-electrical utilities company climbed over 5% in the past week, driven by an upgrade from global brokerage Nomura, and a new single natural gas transportation tariff announced by the Petroleum and Natural Gas Regulatory Board (PNGRB). Effective January 2026, the new structure caps transportation charges at Rs 54 per MMBtu (metric million British thermal unit() for short distances of up to 300 km, and at Rs 102.9 per MMBtu for longer distances. This change is expected to reduce sourcing costs and help stabilise margins, particularly in markets located further from supply hubs.

Positive momentum was further supported by global gas prices hitting their lowest levels since March 2024, with Asia spot prices dropping to approximately $9.4 per MMBtu. These lower input costs could directly bolster unit margins if retail prices remain steady.

Financial performance remained solid, with Q2 revenue rising 8.9% YoY as volumes grew 3.2% to 9.2 million metric standard cubic meters per day (mmscmd). Trendlyne’s Forecaster projects IGL’s revenue to grow by 3.6% in Q3 on the back of tariff rationalisation and lower value added tax (VAT) on domestic gas sourced from Gujarat. The stock appears in a screener of companies which have shown relative outperformance compared to the industry over the past week.

Management has guided for volume growth of 6-7% for FY26. MD K. K. Chatiwal noted that H1 capex reached Rs 580 crore, with full-year plans of up to Rs 1,400 crore for their PNG infrastructure segment. He mentioned that the company is also looking at “another maybe Rs 700-800 crore” for potential diversification projects.

Nomura upgraded the stock to a ‘Buy’ rating with a target price of Rs 230, citing an improving risk-reward profile. The brokerage believes margins will find support from lower taxes and reduced transmission fees, while the completion of operational transitions should allow demand and volume growth to recover.

3. Crompton Greaves Consumer Electricals:

This household appliances player rose 2.6% on December 18 after Motilal Oswal initiated coverage with a ‘Buy’ rating and a target price of Rs 350 per share. The brokerage sees Crompton transitioning from a traditional electricals manufacturer to a brand-led, innovation-driven consumer company under its Crompton 2.0 strategy.

The brokerage believes the company's increased investment in advertising and promotions, combined with its focus on strengthening the brand and product portfolio, will be key to its future growth.

Crompton Greaves reported a mixed picture for its second quarter. Revenue edged up 1% YoY to Rs 1,916 crore, driven by higher sales volumes. However, its net profit took a hit, falling 43% to Rs 71.2 crore due to higher expenses and raw material costs.

The company's Butterfly appliances business performed well, while its electricals business faced pressures due to cooler than expected weather conditions. Crompton’s acquisition of Butterfly, where it now holds a 75% stake, has significantly strengthened its kitchen appliances portfolio.

Meanwhile, Crompton’s solar rooftop business has taken off, winning nearly Rs 500 crore in orders and giving the new division strong momentum. The company added that its solar pumps business is growing over 100% YoY, as its domestic market share climbed from 6% to 8%.

Management is betting big on this solar division, believing it could become the company’s second-largest business over the next few years. CFO Kaleeswaran Arunachalam said, “We are targeting Rs 2,000 crore in revenue from our solar business over the next 18–24 months, supported by recent large contract wins and a focus on expansion.”

Motilal Oswal expects a dip in earnings this year, mostly due to continued cool weather, but sees a clear path to improving profits and profitability in the medium term. The brokerage estimates a revenue CAGR of about 8% over FY26–28.

4. Leela Palaces Hotels & Resorts:

Thishotel chain surged 4.8% on December 16 after ICICI Securitiesinitiated a ‘Buy’ rating, with a 45.7% upside. The brokerage highlighted Leela's position to capitalise on India's shortage of new luxury hotel developments, and a widening demand-supply gap.

According to HVS Anarock, luxury hotel demand in India is set to soar 13.7% annually between FY26-28, while supply will lag at 8.8%. This supply crunch is expected to boost room rates and occupancy for existing hotels.

Leela’s portfolio is perfectly positioned to capture this trend. In FY25, the company's average revenue per available room (RevPAR) stood at Rs 15,306, 1.4 times higher than the luxury segment's industry average. The companycurrently operates 14 hotels with 4,090 rooms, blending owned and managed properties.

A pivotal strategic move came in late 2025 with Leela’s leap onto the global stage. In November, the companyacquired a 25% stake in the Dubai entity that owns Sofitel The Palm for Rs 437 crore. The property is set to be rebranded as a Leela, marking its first international flagship.

CEO Anuraag Bhatnagar projects major growth andsaid, “With a strong pipeline of over 1,500 rooms, we are well-positioned to capture this opportunity as we target approximately Rs 2,000 crore in EBITDA by FY30.” Leela is investing Rs 654.6 crore in room renovations and plans to surpass 5,000 operational rooms by FY30.

InQ2FY26, revenue climbed 12% YoY, fueled by higher occupancy and room rates. Owned hotels led this charge with 13% RevPAR growth.

However, the company's significant concentration risk is weighing on investor sentiment. With over 90% of revenue coming from just five properties, the company is vulnerable to regional disruptions. The stock has also faced headwinds since its debut, trading 5.3% below its June 2 IPO price.

5. Tata Consultancy Services (TCS):

This IT consulting & software company’s stock rose 2.8% over the past week after acquiring Coastal Cloud Holdings and delivering positive updates at its Investor Day 2025. On December 11, TCS’ board approved acquiring 100% of US Salesforce consulting firm Coastal Cloud Holdings and its subsidiaries for $700 million (approximately Rs 6,320.2 crore). This follows another acquisition in October of US-based Salesforce firm, ListEngage, for $72.8 million (approximately Rs 657.3 crore). 

On December 18, TCS discussed its evolution from a digital service provider to an AI-focused technology services provider. The company reported $1.5 billion in annualised AI services revenue, up 16% QoQ. The firm also announced plans to develop a sovereign AI data centre with up to 1 GW capacity, projecting capital expenditures of $6-7 billion over 5-7 years.

Speaking to analysts, TCS’ MD & CEO, K Krithivasan, said, “We aim to achieve an EBIT margin of 26-28% over the next few years, by shifting our revenue mix towards higher margin services and a focus on delivery execution.”

However, Motilal Oswal noted that management's higher-margin goals indicate more growth potential than guided.

The brokerage maintained its ‘Buy’ call on TCS, setting a target price of Rs 4,400 per share, a 34.1% upside. The brokerage believes the company’s growth visibility will improve as AI adoption moves from pilot programs to scaled, revenue-generating deployments. It expects the company to deliver a revenue CAGR of 6.7% over FY26-28.

In Q2FY26, TCS’s revenue grew 2.4% QoQ to Rs 66,666 crore, beating Forecaster estimates by 0.7%. Improvements across banking, financial services & insurance, communication, media & technology segments supported revenue growth. However, net profit declined 5.4% due to higher finance, employee benefits, and license expenses.

Trendlyne's analysts identify stocks that are seeing interesting price movements, analyst calls, or new developments. These are not buy recommendations.

Flying has become a routine event for millions. Planes are full, airports are busy, and most airlines are finally profitable again after years of recovery. Overall, the global aviation industry looks strong.

But behind these headlines, the industry is seeing some fundamental changes. In many of the largest countries, aviation no longer has a wide field of competitors. Instead, capacity is increasingly concentrated among a handful of large airlines. In some countries, three or four airlines share the skies. In many others, one airline holds a commanding majority share, with another acting as a distant second. 

This structure matters because of how it is impacting travellers. People catch a lot of flights, but no one actually likes flying. After the stress of airport security checks, where your favourite shampoo is thrown out if it is in the wrong sized bottle, travellers have to deal with tight legroom, uncomfortable seats, and terrible food. 

Where several strong airlines operate, passengers have choice, and at least some options in quality, legroom, and luggage policies. But when one or two airlines control most of the capacity, choices and safety nets disappear, and even a single operational issue can cause turbulence across the entire system, triggering cancellations, delays, and sudden fare spikes for everyday flyers.

India experienced this first-hand in December 2025. Operational issues at IndiGo, which carries the majority of domestic passengers, caused widespread cancellations. With no large alternative airline to absorb the shock, passengers were stranded, ticket prices on some routes skyrocketed, and the government had to impose fare caps.

“IndiGo’s size has grown to the point where operational setbacks pose systemic risk. If IndiGo or Air India gets into trouble, there will be mayhem in Indian aviation. The government needs to reduce jet fuel taxes and encourage more competition,” said Harsh Vardhan, chairman of Starair Consulting.

Too much flying power, too few players

Some aviation markets today are so dominated by one or two carriers that little room remains for smaller rivals.

India is the clearest example. IndiGo and the Air India Group together control nearly all domestic flights. IndiGo’s growth improved domestic connectivity and helped keep fares competitive, yet this dominance also made the system fragile. 

Policymakers in India have acknowledged this challenge. After the IndiGo fiasco, Civil Aviation Minister K Rammohan Naidu remarked, “We need at least five airlines with around 100 aircraft each, so the country is not dependent on one or two carriers. This is essential to avoid monopoly and duopoly.”

Australia faces a similar problem. The Qantas Group (Qantas Airlines + Jetstar) and Virgin Australia control almost all domestic travel, with smaller carriers barely registering. Recent reports show that these two airlines control over 98% of domestic traffic, leaving passengers with few alternatives and limited bargaining power.

Canada presents another version of the problem. Air Canada and WestJet dominate different regions, and limit direct competition on many routes. A 2025 review pointed to high airport fees and regulatory barriers that protect the existing airlines. This has kept fares elevated and reduced passenger choice.

The UK, while more competitive than these markets, still feels the impact of concentration. EasyJet holds about 47% of total capacity, making it the largest carrier by a wide margin. Rivals like Ryanair and Jet2 provide alternatives, but when major airlines face disruptions, last-minute fares can still rise sharply during peak travel periods.

More airline companies mean fewer system-wide failures

Markets with a few strong competitors—rather than just two—handle crises much better.

The United States is the best example for a non-monopolistic aviation market. Four airlines — American, Delta, United, and Southwest — share most of the market. No single airline dominates completely. This balance prevents system-wide collapse.

North American carriers are competing by boosting premium offerings, with ~90% of widebodies now having premium economy. They are now fighting for customers based on reliability and comfort, not just the cheapest ticket.

Brazil fits here better than it appears at first glance. LATAM Brasil is the largest carrier with roughly 38% market share, but it does not control the market outright. GOL Linhas and Azul together ensure no single airline can dictate pricing unchecked. While competition on major routes is not fierce, the presence of three sizable players provides more stability than a two-airline system.

The UAE represents a different form of oligopoly. Emirates and Etihad dominate the market, but they compete globally rather than just domestically. Emirates is owned by Dubai’s Investment Corporation, alongside flydubai, which serves regional and domestic routes. Etihad is wholly owned by Abu Dhabi’s ADQ sovereign wealth fund.

State backing provides patient capital and strategic staying power, enabling both carriers to compete aggressively with global hubs like Qatar Airways, Lufthansa, and Turkish Airlines. The mix of a few dominant players, strong state support, and layered domestic competition makes the UAE airline market uniquely competitive.

When rails outspeed the skies

Aviation is also more balanced in markets where high-speed rail shares the load.

China’s airline market appears competitive, but high-speed rail has reshaped travel patterns. For journeys under 800 km, trains are faster and easier than flying. On the Beijing–Shanghai corridor, high-speed rail captured about 34% of airline passengers. This forces airlines to focus on longer routes and limits their pricing power on domestic sectors.

Japan looks like a classic two-airline market, which usually means high prices. But Japan is different. The Shinkansen bullet train keeps airlines in check. On routes like Tokyo–Osaka, trains carry over 80% of travellers. Airlines have to offer better service and sharper prices just to stay relevant.

This competition between trains and planes creates a rare result: high reliability and great service without crazy prices. It proves that the best check on an airline monopoly might not be another plane, but a fast train.

What does this mean for travellers?

Rising passenger numbers can hide deeper problems in aviation markets. When most flights are controlled by just a few airlines, even minor disruptions affect the entire system. For travellers, this often means higher fares and minimal options when flights are cancelled or delayed.

Governments are finally taking notice. Fare caps in India and competition reviews in Europe show increasing concern that aviation needs backup options, not just bigger airlines. As travel demand keeps rising, stable air travel will depend on policies that support real competition — through more airlines, easier airport access, and alternatives like high-speed trains.

Early December, usually a great time to travel, became a national nightmare this year across Indian airports. As IndiGo flights across the country were cancelled, the best laid plans fell apart. One student missed an engineering hackathon they were preparing for over the last several months. Many travellers missed exams, weddings, funerals, and long planned for international vacations.  Suitcases disappeared into the black hole IndiGo called the "check-in counter", so people couldn't even just give up and go back home. 

I escaped the chaos only because I was flying to Siliguri on a different airline, for my sixth wedding anniversary. But I saw the chaos at the terminal. The helpless ground staff stood there absorbing it all, one complaint at a time.

The silver lining, if we try to find one, is that people have now started talking about monopolies in Indian industry. India has several sectors where market power is concentrating very quickly into a few hands. If we don’t course-correct, it is very likely that the “IndiGo moment” will repeat elsewhere.

Competition is good, economists say. But the stock market doesn't reward it

Economists agree that competition in industries lowers prices, improves quality, and gives consumers more power. But investors actually prefer the opposite. The stock market loves companies with a “moat”: businesses that are so dominant, and with such high entry barriers that new players don't stand a chance. Warren Buffett for example, lovesCoca-Cola, Moody’s and Apple, companies that have either absorbed or killed most of their competitors, and are hyper-dominant in their sectors.

Palantir's Peter Thiel openly says that "competition is for losers". Even the economist Joseph Schumpeter, who gave us the idea of “creative destruction” as new companies replace old ones, eventually concluded that monopolies might be capitalism’s natural end state.

Consumers want choice, but markets reward dominance.

India is seeing a concentration of power across sectors

To measure competition, economists use the Herfindahl-Hirschman Index (HHI). A score below 1,500 means a competitive economy. Between 1,500 and 2,500 suggests moderate concentration. Anything above 2,500 is monopolistic and sets off alarm bells.

For the first time in over a decade, India has entered the“highly concentrated”danger zone. The HHI climbed from 1,980 in FY15 to 2,167 in FY20, and has crossed 2,532 in FY25.

Many Indian sectors now have a few companies with significant market power.  Telecom for example, has become a slugfest between Bharti Airtel and Reliance Jio. Aviation has IndiGo and Air India dominating. In steel, four companies control more than half the market. And in cement, the Aditya Birla Group and Adani Group now have more than 50% of the market, and are still acquiring smaller players. 

The concentration of market power gives companies pricing power, forcing consumers to pay more. It can also quickly reduce product options and quality. 

This is just the tip of the iceberg

Few sectors in India show the problem better than aviation. India's domestic airfares were 43% higher in early 2024 than in 2019. In Asia, only Vietnam saw a bigger jump.

Two decades ago, India had close to ten airlines. Today, IndiGo and Air India control nearly 90% of the market. On many routes, there’s only one choice, usually IndiGo, which makes it the default price setter.

Airports are also increasingly controlled by just two private players, Adani and GMR, alongside the Airports Authority of India. Adani’s rapid expansion across airports, ports, and even lounges wiped out Dreamfolks’ once-dominant lounge business almost overnight.

History has a warning for us. The US spent the early 20th century breaking up Standard Oil, regulating railroad barons like Vanderbilt and Gould, and placing utilities under strict oversight. The US government cracked down after these monopolies raised prices, shut out competitors, and held entire regional markets in the US hostage.

India appears to be learning that lesson now, the hard way.

A global pattern

Globally, the pattern right now is 'bigger is better'. In the US, monopolies are making a comeback. Markups — the gap between price and cost —have jumped nearly 3X since the 1980s as industries have consolidated and companies feel free to increase prices. 

For example, Bayer, Corteva, Syngenta, and BASF dominate global seeds and fertilisers. A few players control pharma generics and vaccines; VisaandMastercard handle 80% of card payments, China’s Alipayand WeChat Pay control 95% of QR payments within China, and even India’s open UPI has created two dominant apps, PhonePe and Google Pay.

This pattern of fewer players, higher profits and weaker competition is now visible across many industries globally, pointing to more “winner-take-most” markets. We must worry about it as we, the consumers, are the ones paying a hefty price.

Should India dismantle its giants?

Former RBI Deputy Governor Viral Acharya has been sounding the alarm on monopolistic markets for years. His research shows that market concentration in India surged after 2015, driven by an industrial strategy favouring “national champions.”

By 2021, India’s biggest business groups controlled nearly 18% of assets in non-financial sectors, up from 10% in the early 1990s. Meanwhile, the next five largest groups saw their share halve. The dominant companies didn’t just crowd out small players, they squeezed out other large competitors as well.

One option, Acharya argues, is dismantling such groups where necessary. Recently, former Maharashtra CM Prithviraj Chavan and the President of the Federation of Indian Pilots, Captain C S Randhawa, urged the government to break IndiGo into at least two separate airlines.

China offers an instructive example. In the 1980s, it split its state airline into six entities. Three major airlines—Air China, China Eastern, and China Southern—emerged. Even today, together they control less than half the market.

Can India reverse this trend?

A monopoly, like a weed, is difficult to remove once it's entrenched. Dominant companies will fight, lobby, and pay the media to make their arguments for them. India needs a Competition Commission that can act before market power turns into abuse. The IndiGo episode should be a broader wake-up call.

Currently, the Competition Commission of India (CCI) intervenes only after abuse such as overpricing, blocking rivals, or distorting markets. In sectors like aviation, digital platforms, logistics, and infrastructure, that often means that they step in too late, after rivals are weakened and consumer choice has already shrunk.

The solution lies in reform. Some work has already begun. A Standing Committee report submitted in August backs ex-ante rules, stricter scrutiny of acquisitions, faster enforcement, fewer court delays, and a stronger CCI with better funding and expertise. It also calls for reviving a National Competition Policy, so that encouraging competition explicitly shapes government policy across sectors. Now it remains to be seen that if our current billionaire businessmen will let this happen.