LTCG won’t be the key reason for market to fall.. may be it will be used as an excuse …
Feedback from Market veterans on LTCG
Everyone sounded disappointed, but said now its reality so need to move on Grandfathering is good decision (Or else markets would have fallen sharply). From here till March 31st – only if there is a big rally, investors will sell (feedback is from Jan 31st high.. its unlikely there will be big rally till March 31st. Now there is no big distinction between long term and short term (No big incentive to hold for more than 1 year now)
Zero Long term was incentive to invest into equities (why would anyone look at equities if returns are in line with bonds and 1 has to face volatility)
Sounded very bearish .. he said Jan 31st stock price is the likely top of this year Markets may go down tmow (ie today—SGX down 100 points right now) Many sectors, stocks (especially midcaps trading at crazy valuations). Market correction Will test New freed of investors – they have not seen any sharp fall in last 3 years. We All have gained disproportionately in equities in last 3 years. I think there will be prolonged correction in near term. Elections will be risk factor (Recent NDTV poll suggesting not more than 250 seats to BJP) If there is correction.. Will spend time with family
LTCG – now Door is opened. Nothing to say this will not increase in further – from 10% to 20% in future. He sounded disappointed, Said No Long term tax was incentive for investors to invest into equities.. not any more. Oil will further go up.. Govt will have to revive other revenues. That said my view remains extremely bullish .. It’s a global bull markets and India will be part.
I am optimistic. Small cap will do very well. LTCG was unwanted and uncalled for
Long term is disincentive for equities. Joy in hunting good cos.
Investment opportunities are still high.
Serious correction only can come from global markets. LTCG won’t trigger serious correction. Don’t think Mf flows will slow down – my experience is in 1st fall – retail investors buy – only after serious 20% fall, domestic flows reverse. Lot of cos seeing significant improvement.. Where is alternate to equities ?? TINA factors – this is something every one eluded to. Don’t think MF inflows will stop is hurry. Some serious work done on make in India. Mobile phone tax increased… Zero to 10% for mother board – Compulsion to make manufacturing in India = GOOD for Many cos.
His firm view — GST collection will improve in next 3-4 months and tax collection will be significantly higher this year. But he feels inflation will firm up further. Personally insurance cover for poor is a good move. There could be correction, but don’t expect a vertical fall.
I am still bullish. Tomorrow let’s see how markets react (I shorted banks looking at sharp rise in yields. Don’t think flows will reverse so soon.
Deal flow Is strong because valuations are very high. Every promoter is looking to sell… even PEs are willing to sell. So supply of paper will be very high.
We are in PE expansion phase. Long term trend positive. But correction likely in near term. Midcaps trading way to expensive to large caps. Large caps will do better than midcaps in near term.
Correction has started. People are under estimating correction.
Tax collection buoyant. I remain optimistic . I don’t see euphoria.
I was disappointed with LTCG. Grandfathering is a big relief. See flat returns next 1 year.
Earnings will definitely grow. Bosch saying there is huge demand.