In 1964, the acclaimed American filmmaker Stanley Kubrick was looking for a new story. He had just made Dr. Strangelove, and wanted to make what he described as a really good science-fiction film. He approached Arthur C. Clarke, the British writer whose novels had already established his reputation in science fiction. The two began working together on what would become 2001: A Space Odyssey.
The film arrived in 1968, a year before humans first landed on the Moon. It imagined a future of routine space travel, intelligent computers and machines that could talk to humans. At the centre of that story was HAL 9000, the computer running the spacecraft Discovery One. Kubrick and his collaborators imagined HAL as capable of conversing with humans in natural language, something far beyond the computers of the time.
HAL’s problem was not simply that it was intelligent. It was that the astronauts eventually could not be sure they understood what the machine was doing, or whether they remained in control of it.
Why are we reminiscing about an old Hollywood movie now?
Well, because nearly six decades later, the question those astronauts grappled with has moved from science fiction into the business of building artificial intelligence—or what US President Donald Trump now calls “superintelligence”.
Anthropic, the AI company behind Claude, is preparing for an initial public offering that could potentially be the largest in history and could value it at more than $2 trillion. The company confidentially filed for an IPO with US regulators in June, and some media organisations such as Reuters reviewed the draft prospectus this week.
The draft prospectus offers an unusually detailed view of what it takes to build a frontier AI company. Anthropic’s revenue grew nearly 12-fold in 2025 to about $4.6 billion. Its operating loss was $8.06 billion. Its reported net loss was about $42 billion, although roughly $34 billion of that reflected an accounting charge related to the increase in the estimated value of financing that could eventually convert into shares, rather than cash spent operating the business.
But the bigger number is still ahead. Anthropic has at least $518 billion in long-term cloud, computing and infrastructure commitments over the next decade. About 80% of that amount is non-cancellable or payable regardless of how much computing capacity the company actually uses. The commitments include at least $111.1 billion with Google, $110 billion with Amazon, $31.4 billion with Microsoft and $161.2 billion in obligations linked largely to Broadcom.
The big numbers aside, the draft prospectus is full of paradoxes. The company says its AI can “dramatically improve quality of life” and “transform” the global economy, but it also warns that its AI models can develop unexpected capabilities, harmful behaviours and “potentially decisive influence over a broad range of human undertakings”.
Advanced AI systems could even “pose catastrophic or existential risks to humanity”, it warns.
So, how does it propose to reduce those risks? That’s another paradox. It admits a concentration of power is risky. “AI deployed at scale has the potential to concentrate power and wealth in ways that could harm society and destabilize the geopolitical order,” it says. But it then says it needs to concentrate control and capital in ever fewer hands and seeks to entrust its founders with running the business, even if that limits oversight by investors and public shareholders.
The IPO filing, along with recent cases of AI models breaching organisations from the US to Australia and dire warnings by researchers and critics, highlights the case of greater control and regulatory oversight on these AI companies.
But, at least for now, the US government is showing no signs of urgency. Trump this week released a one-page AI accord signed by him and executives from Anthropic, Google, Meta, OpenAI, Nvidia and xAI.
The document calls for companies to maintain internal controls over AI systems, monitor their capabilities and behaviour during development and deployment, and work with independent auditors or evaluators to assess whether those controls are working. It also calls for independent board oversight of AI safety and regular cooperation among the companies on standards and best practices.
The accord is a voluntary commitment, not a new federal law. Trump described it as “morally binding”. The companies also agreed that, over time, some of these measures could be codified into laws or regulations.
While Anthropic’s draft prospectus shows the growing capability and reach of frontier AI, the accord addresses the other side of that equation: how those systems are to be monitored as they become more capable.
Behind all of this sits the question of 2001: A Space Odyssey, but raised in a different era: as the machines become more capable, can the systems designed to keep humans in control keep pace?
Steel Yourself
From the world of advanced technology, let’s now move on to brick-and-mortar. US President Donald Trump this week announced a planned $15 billion steel complex in Iowa by a company called Mesabi Metallics. The project will use iron ore from Mesabi’s mine in Minnesota, where the company will spend another $3 billion.
Steel production is expected to begin in 2030. The first phase is planned at 7.5 million tonnes of steel a year, eventually rising to about 10 million tonnes. The plant will employ at least 1,750 people and support up to 6,000 construction jobs.
Why should this interest those of us sitting in India? Because while the ore will be mined and the steel will be made in America, the company actually doing it is part of the Indian conglomerate Essar Group.
Essar has already invested $2.5 billion in the Minnesota operation. The US Export-Import Bank approved a $770-million loan for the mine and has said it could support the broader expansion with up to $10 billion in financing.
The project becomes more interesting as the investment is being announced under a US trade regime built around a 50% tariff on most imported steel products that has affected Indian companies such as Tata Steel and JSW Steel.
Essentially, an Indian-backed company is putting capital into an American mine, an American steel plant and American workers, to serve the American market.
To be sure, Essar isn’t the only Indian company making big-ticket investments in America. The Adani Group has also announced plans to invest $10 billion in US energy and infrastructure projects after the Trump administration ended civil and criminal cases against Gautam Adani in cases related to alleged bribery and violating sanctions on Iran.
In March, Trump announced an oil refinery in the US to be funded by billionaire Mukesh Ambani’s Reliance Industries as part of a 20-year deal worth $300 billion. And then, there are a number of Indian tech and pharma companies that have been buying US companies and setting up base in the US to skirt tariffs and expand their operations.
It may be a little too soon to say how much of the promised investments will actually materialize. But the direction is clear. And that may not be a bad thing for India Inc.
Tata’s Turmoil
Coming back to India, the turmoil in the storied Tata Group isn’t showing signs of ending anytime soon.
Tata Sons, the group’s holding company, is facing a listing requirement after the Reserve Bank of India classified it as an upper-layer non-banking finance company. Tata Trusts, the group’s charitable arms that control Tata Sons, are now proposing to change the structure of the holding company itself.
The Trusts, which own 66% of Tata Sons, have proposed merging Tata Electronics Systems Solutions (TESS) and Tata Consulting Engineers (TCE) into the holding company. The idea is to bring operating businesses back into Tata Sons so that it has substantial operations and revenues of its own, rather than being primarily an investment-holding company.
The proposal comes after the RBI rejected Tata Sons’ application to surrender its registration as a Core Investment Company on September 11. Tata Sons was classified as an upper-layer NBFC in 2022, a category that carries a mandatory listing requirement.
Tata Trusts has opposed a listing, saying it would dilute the group’s philanthropic mandate. Tata Trusts chairman Noel Tata wants the Tata Sons board to explore options other than listing. The latest proposal is the most concrete alternative put forward since then.
The mechanics are straightforward. TESS, a wholly owned subsidiary of Tata Electronics, and TCE, an engineering and project consultancy business, would be merged into Tata Sons. According to Tata Trusts, the resulting company would have Rs 1,05,043 crore of operating revenue as of March 31, 2026, against Rs 40,072 crore of income from financial assets. Operating revenue would therefore account for 64.3% of total income.
Tata Trusts argues that this mix of operating revenue and financial income would take Tata Sons outside the RBI’s principal-business criteria for an NBFC.
There is a second regulatory test to clear: the one for CICs. Tata Trusts says the combined entity would have net assets of Rs 2,00,158 crore, of which Rs 1,77,120 crore would be investments in group companies. That would put such investments below 90% of net assets, according to the Trusts, taking the proposed entity outside the CIC test.
The idea also has a historical precedent. Tata Trusts says Tata Sons had operating businesses and revenues of its own for most of its first 100 years. Tata Consultancy Services, for example, remained a Tata Sons business division until it was demerged in 2004.
But this is still a proposal. Tata Trusts has asked the Tata Sons board to consider and approve the restructuring and apply to the RBI for a prior no-objection certificate. The Trusts and Tata Sons would then engage with the RBI on the proposal.
If the restructuring takes effect and Tata Sons ceases to qualify as an NBFC and CIC, the listing requirement would, in the Trusts’ view, fall away. But that is Tata Trusts’ argument, not yet an RBI determination.
For now, Tata Sons remains within the regulatory framework that created the listing issue. The question is whether adding operating businesses can change the regulatory classification that triggered it.
Meanwhile, Noel Tata himself is on the backfoot. First, the Tata Sons board overruled him and reappointed N Chandrasekaran as the company’s chairman. And this week, TVS Group’s Venu Srinivasan—who is on the boards of Tata Sons and Tata Trusts—has sought a regulatory probe into alleged internal lapses and asked why the philanthropic arm is interfering in the commercial affairs of Tata Sons.
Interestingly, Srinivasan and Chandrasekaran are also alleged to have failed to disclose a business relationship involving Chandrasekaran’s family-owned company and TVS Motor to the Tata Sons board or Tata Trusts.
All in all, the entire thing is a big mess and it will be a while before the group comes out of it. We only hope it’s sooner than later, and before the reputed group suffers more damage.
The Memory Squeeze
From corporate controversies, let’s now switch to a development that directly affects us the consumers.
Just as the festive season arrives and offline as well as online retailers begin to advertise “massive discounts”, here’s a reality check. Over the past few months, the prices of smartphones have zoomed higher to the dismay of those looking to buy or upgrade their devices. This week, a report highlighted the extent of the price hikes and its impact on demand.
Smartphone prices in India rose 16% on average in the first half of 2026, according to Counterpoint Research. The price hikes were different across segments. The steepest price hike across the industry was 113%, according to Counterpoint. Phones priced below Rs 10,000 saw average price increases of about 32% in the first half of 2026. No wonder, then, that shipments in the segment sank 65% from a year earlier.
Shipments in the Rs 10,000-15,000 segment, historically one of India’s largest, fell 20%. Demand for phones above Rs 20,000 held up better, the research firm says. That suggests the pressure is not being felt evenly across the market.
But why are prices rising at such a quick pace? Smartphone brands are dealing with sharply higher memory costs as AI data centres absorb large amounts of DRAM and NAND supply. (For non-techie folks, DRAM is the main memory used in smartphones and computers while NAND is used in storage devices such as SSDs and USB flash drives.)
A weaker rupee has added to the cost of imported components.
The difficulty is greater at the lower end because there is less room to absorb higher costs without raising the final price. A Rs 2,000 increase means something different on a Rs 10,000 phone than it does on a Rs 50,000 one.
To be sure, the data pertains only to the period ended in June. And a quick search on ecommerce platforms shows the prices have risen even further in the July-September quarter.
So, by when prices are expected to cool down? Counterpoint says memory prices are unlikely to come down before 2028. The rupee remains weak, too. Basically, the price pressures aren’t going away anytime soon. If you are planning a purchase in the near future, be ready to shell out more.
Market wrap
India’s stock market benchmarks logged a loss for the holiday-shortened week, driven down by foreign portfolio investors’ heavy selling, high crude oil prices and a surge in global yields.
The Nifty 50 sank 3.1% and the BSE Sensex dropped 2.7% this week. This is their eighth consecutive week of losses and marks the longest such streak in 25 years when the dotcom bust in 2001 had dragged stocks down.
This loss was the Nifty’s sharpest weekly drop in six months and the Sensex’s steepest in four months. The Nifty 50 has slumped 8.7% and the Sensex 8.4% in these eight weeks.
Foreign portfolio investors have net sold Indian stocks worth $28.8 billion so far this year, NSDL data show. Meanwhile, US Treasury yields have touched their highest levels since 2007, making emerging market assets such as Indian equities less attractive to overseas investors. A widely expected rate hike by the Reserve Bank of India next week and the rupee’s weakness also weighed on sentiment.
In the broader market, the small-caps dropped 3.4% and the mid-caps lost 3.6% this week.
All but one of 16 major sectors recorded losses this week–the IT sector was the outlier. Infosys rose over 2% while HCL Tech and TCS were largely flat and Tech Mahindra slipped only about 0.6%.
Kotak Mahindra Bank was the top gainer, rising 3.3% after the RBI approved the appointment of Anup Kumar Saha as its next CEO. Axis Bank rose after tying up for the launch of Apple Pay in India. IndiGo parent InterGlobe Enterprises, Asian Paints and HDFC Life were among the other gainers.
Bajaj Auto was the biggest loser, slumping more than 10% after reporting a 12% drop in September two-wheeler sales. Royal Enfield maker Eicher Motors, Tata Motors Passenger Vehicles, Maruti Suzuki and Mahindra & Mahindra fell 4-5% each.
Other stocks that slid at least 5% included Max Healthcare, Apollo Hospitals, ONGC, Titan, Jio Financial, Grasim, Eternal, Tata Steel and Hindustan Unilever. Among heavyweights, Reliance Industries lost over 4% while HDFC Bank fell 1%.
Other Headlines
- Industrial gas maker Inox Air Products files draft prospectus for IPO
- Renewable energy firm Inox Clean Energy files for Rs 10,000-crore IPO
- Snapdeal parent AceVector’s IPO subscribed 4.9 times
- Fintech firm MoneyView’s IPO subscribed over 98 times
- Student housing firm Elevate Campuses lists at a 1.9% discount to IPO price
- US food delivery firm DoorDash to create 3,000 jobs at global tech centre in Hyderabad
- Apple Pay launches in India with Axis Bank partnership
- SEBI allows Gautam Adani, four group firms to settle public-float violations case
- Supreme Court allows forensic audit in Fortis-IHH Healthcare case
- Govt approves Rs 1.86 trillion for renewable energy programme
- India’s April-August fiscal deficit reaches 42% of 2026-27 target
- June-September monsoon rain in India 12.6% below average, lowest in a decade
That’s all for this week. Until next week, happy investing!
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