Citi sees $10-12 billion IPO pipeline in 3 quarters, says Amol Gupte

Citi's Amol Gupte says India's reform push and strong domestic demand will help navigate US tariff shocks; sees GST cuts boosting growth, FDI pipeline intact

Amol Gupte, Asia South head at Citi, believes India’s reform drive will help navigate the uncertainty posed by US tariffs that the bank expects to settle at 25 per cent. In an interview with Manojit Saha and Subrata Panda in Mumbai, he noted that the FII exodus was a nuanced phenomenon as they continued to bet big in the primary market that Citi expects to boom from now to Q1 2026-27. Edited excerpts:

 

How do you see the GST reforms announced recently?

 

There is a famous saying — never waste a good crisis. What we are seeing in India right now is a little bit of that. Previously, income tax realignment was done, and now the GST reform has happened. You could argue whether this would have happened on its own with the same pace, or if it is happening now because of the tariff shock. But I see all of this as very positive. India is going into this with a strong balance sheet, a strong financial sector, and a strong corporate sector. So there is no better time to do a reform than a time like now. There is more reform that India should look at to improve the ease of doing business. If you look across the region (South Asia), India stands out because of its domestic consumption story. Most other markets in Southeast Asia are more export-oriented economies. So, the overall India story is still incredibly intact.

 

Will this reinvigorate  demand in the economy? 

It will certainly drive demand. Clearly, whatever the government is bearing as a cost is a give into the consumer’s pocket.

 

What will be the economic impact of the US tariffs?

 

It will be a little while before we see the real impact. I do not believe the tariffs will stay at 50 per cent. Our base case is that it will not stay at 50 per cent going into FY27. We think that 25 per cent is probably where it will settle down, which is not really very different from the manufacturing neighbours in South Asia.

 

How do you see the interest rate trajectory in emerging economies like India unfold?

 

In the US, we expect a cut in the September cycle. Inflation in the US is going to prove to be a little sticky with these tariffs. US consumer confidence may get impacted. If that happens, it has an impact on export-oriented economies, but not so much on India, because it is not such a heavy export-oriented economy. But emerging market central banks will feel pressures to keep rates low because their economies will see softening as exports drop. And hence, to spur the economy, they will see rates staying low. In India’s case as well, rates could stay low for a while.

 

Which is the most promising territory for Citi in South Asia?

 

India is hard to compete with for any other country, and it is one of our flagship franchises. Without a doubt, it ranks among our top three franchises globally outside our home market, attracting a disproportionate share of interest, investment in technology, people, resources, and balance sheet. The opportunity in India is immense -- we support multinationals entering the country by helping them understand how to do business here and providing a wide range of capital solutions, while also enabling large Indian corporations to expand overseas.

 

In India, we are the banking partner to more than 3,000 global multinationals operating in India and cater to the global needs of over 250 large India-parented conglomerates. We manage close to 8 per cent of the country’s trade flows and around 4.5 per cent of electronic payment flows. Our custody business is market-leading, handling nearly 36 per cent of foreign portfolio investor (FPI) assets and about 29 per cent of underlying flows. We also hold a leadership position across investment banking products, having advised clients on capital raising and merger and acquisition (M&A) transactions worth over $500 billion in the past two decades, and are currently ranked number 1 on the equity capital markets (ECM) and M&A league tables. Importantly, we remain the only international bank in India with a full-service institutional platform that spans investment banking, advisory, capital markets, trade and transaction services, markets, securities services, and risk-management solutions, backed by a global network with a presence in 95 markets.

 

How has life been for Citi after exiting the consumer business in India?

 

I am really proud to say that the India team has delivered growth in the 25–35 per cent range. And today, in India, the business that we have – institutional business – is larger than what we had with our consumer business. Revenues have grown 25 per cent and our profits have grown 34 per cent last year.

 

What is the impact on Citi due to tariffs since you handle 8 per cent of trade flows?

 

It’s very hard and early to tell what the impact is because it’s one week old. When you have a business like we have here, which is so large and so diversified, if one engine is not firing so much, it doesn’t hurt us. But there would be no reason for me to put any sort of revenue caution because of this. It’s not going to have any material impact in a meaningful way.

 

What is Citi’s strategy under the new leadership?

 

Our strategy remains unchanged -- it is rooted in being a bank that enables clients and supports cross-border business. On one hand, we bring multinationals into India, facilitating foreign direct investment (FDI) and helping them invest and operate here, leveraging our deep understanding of how to do business in India, which is unparalleled. On the other hand, we partner with large and mid-sized Indian corporations seeking to expand overseas -- and no bank is better placed than us to do so. These are the two key engines of our strategy, and they will continue to drive our approach.

 

Net FDI in India is falling…

 

The pure FDI story is very strong. Gross inward FDI is around $80 billion, with a record $25 billion coming in during Q1 alone. Outward flows, however, are a different story. As a result, the net number appears small. These outward flows are being driven by different factors. One is FII flows, where a fair amount of exits has taken place. The Securities and Exchange Board of India (Sebi) is introducing significant reforms that will make it easier for FDIs to enter India, which should help bring that money back. The other driver of net flows is the increasing amount of money flowing abroad from Indian retail investors. This is largely a natural outcome of rising consumption power and a growing middle class.

 

Are your South Asian clients, who also operate in India, excited about listing in India?

 

I think this will continue to happen. The scale of value that Hyundai created is just enormous. It’s one of the Korean companies that really got the India market right. Will those dominate the India market? I don’t think so. You will still have a lot of domestic local demand. We have done some of the largest IPOs in this market in 2024, as well as 2025. We see a pretty good pipeline into the next 2–3 quarters. We see a $10–12 billion IPO pipeline by the first quarter of next year (Q1FY27).

 

This is despite the markets being choppy and FII money going out…

 

It is true that FII money is going out. But I think external investors investing in primary issues is still very strong. We see the investor demand on primary issues still very strong. So, secondary markets are a different story, which you should separate and not cloud by saying that investors are not heavy on India. The secondary markets are a function of what is happening in global markets.

 

How do you see capex plans of Indian corporations?

 

We are seeing to some extent private capex is not as energised as it could be. Corporate firms are also in great health and sitting with a lot of cash, so there is not so much going into capex. But we see some of the large capex announcements made in the EV sector. We also see some large capex announcements made in the tech sector for data centres. So there is a fair amount of new capital being raised that is going into growth.