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Buzz in Market

ICICIdirect Research Posted on 05:47pm 12-Mar-2020

CoVid19 panic - Exit or a buying opportunity?

Globally equity markets (including India) have taken a beating, correcting significantly in a relatively short span of time. A million-dollar question right now, Is it a buying opportunity or an exit indicator to enter later? The novel corona-virus has spread from a few hundred cases being reported pre-dominantly from the Hubei province of China, to all over the world taking the total tally of affected people globally to more than 1,20,000 and the death toll also rising at an alarming rate. It is definitely going to have an impact on global growth. But is it discounted?

Historically, buying at sharp dips has been rewarding as markets recover after initial reaction but timing may be unknown. Do you think this time it’s different?

Share your thoughts with fellow 120000 traders and investors on iCommunity.

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Buzz in Market

ICICIdirect Research Posted on 06:25pm 31-Jan-2020

Updates from Union Budget 2020 - 2021

> Custom duty to be reduced on imported footwear and furniture to boost domestic manufacturing 

> Deduction of Rs. 1,50,000 on loan sanction and tax holiday on profits of developers involved in affordable housing projects to be extended by one year to FY21 – positive for real estate players having exposure to affordable segment 

> G-Sec ETF to be floated to promote retail participation in debt markets. 

> FPI limit in Corporate Bond Market has been increased from 9% to 15% of the total outstanding. 

> Dividend distribution tax abolished, positive for IT companies which have higher dividend payout 

>Deposit insurance guarantee increased from Rs. 1 lakh to Rs. 5 lakh. Boost to bank deposit as it raises confidence, though cost could go up marginally for banks 

> Focus on digital technologies and e-governance, positive for IT companies 

> Implementation of prepaid smart meters in three years and freedom to choose power supplier will lay the ground to bring competition in the power sector. Positive for private power discom companies, smart Meter manufacturing companies, power generation companies 

> 2. Rs. 3150 crore set aside for Ministry of Culture to develop 5 new archaeological sites with on-site museum, renovation of other museum among others – positive for tourism 

> Rs. 2500 set up for promoting tourism at the state level 

> 148km Bengaluru sub-urban transport projects worth 18000 crore, Rs. 1.76 lac crore for transport infrastructure, 100 more airports by 2024. Positive for infrastructure EPC, infrastructure developers and capital goods companies 

> 12 lots of highway bundles of ~ 6000 km including Delhi-Mumbai expressways by 2020, 4 station development projects and proposal for 150 private trains is under way 

> Setting of large solar power capacity alongside the rail track on land owned by railways. Aim to achieve electrification of 2700 km of track. Rs 22000 crore allocation for power and renewable sector. Positive for solar EPC companies/ Solar generation companies 

> Allocation of Rs. 1.7 lakh crore to be provided for transport infrastructure in 2021 – positive for construction companies 

>Budget proposes to expand National Gas Grid from 16200 km currently to 27000 km 

> Rs. 1480 crore to be allocated towards setting up a National Textiles Technical Mission 

> National Logistics Policy to be launched soon that would provide single window e-clearence for transporters. Would provide for scaling up of existing logistics operations. Positive for surface and air logistics players 

>2,500 km expressways, 9,000 km economic corridors, 2,000 km coastal roads and 2,000 km strategic highways proposed to be constructed – positive for road based EPC players  

>12 lots of highway bundle projects (total 6,000 km) proposed to be monetized before 2024 – positive of companies with BOT assets 

> 100 new airports to be developed by 2024 to provide further support to UDAN scheme – Positive for aviation and tourism 

>Eradication of Brucella and PPR diseases among cattle by 2025. Beneficial for Animal Health companies 

>Viability gap funding (VGF) for setting up hospitals in 112 districts (not having Ayushman scheme empanelled hospitals) by using proceeds from tax on medical devises. Beneficial for hospitals 

>Proposal for setting up of medical colleges in existing district hospitals with the help of private hospitals under PPP mode with Viability Gap Funding (VGF). Beneficial for private hospitals 

>Government to allow viability gap funding to setup advanced warehouses. Positive for players providing agricultural warehousing 

> Rs 99300 cr allocated for education sector for FY21. New education policy to be announced soon

> Allocation of Rs 3.60 Lakh crore and Rs 12300 crore for Jal Jeevan mission and swachh Bharat mission respectively to benefit FMCG, piping industries. 

> Rs 3.6 lakh crore allocated for Jal Jivan Mission – Positive for Water EPC players 

> Rs. 11,500 crore capital outlay provided for Jal Jivan Mission during 2020-21 – positive for EPC and construction companies 

> Agriculture credit target increased 25% YoY from Rs. 12 lakh crore to Rs. 15 lakh crore. 

> Govt looking to change existing regime that promotes excessive use of chemical fertilisers – Negative for Urea manufacturers 

> PM Kusum scheme expanded for 20 lacs farmers for solar pumps – Beneficiaries KSB pump

Buzz in Market

ICICIdirect Research Posted on 01:55pm 27-Sep-2019

Are the corporate tax reforms enough to bring back growth?

On 20th September, the Finance Minister announced corporate tax rate cuts for domestic companies and also introduced significantly lower taxes for new companies setting up their manufacturing facilities in India. This move has spurred optimism in the markets with indices posting strong up move. While this is a significant move taken by the government to revive the Capex cycle and attract new investments, do you think It will help in addressing the issue of consumption slowdown which has been seen in the recent past? Also, the government would be losing out on ~| 1.45 lakh crore of revenues, would it lead to a widening of the fiscal deficit? Click on the title to join the discussion.
Buzz in Market

ICICIdirect Research Posted on 06:01pm 23-Aug-2019

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Do you expect a slowdown in automotive industry to be a prolonged one?

With no signs of a letup, automotive industry has been facing several headwinds in the form of tepid demand, higher inventory, loss of jobs etc. In addition, auto dealerships continue to face credit crunch at their end and have also began laying off employees.  Overall, an extended weak slowdown in automotive demand could impact many small vendors who manufacture spares and ancillaries to these original equipment manufacturing companies. All the above factors currently paint a tough FY20E for the automotive industry with near term triggers in the form of upcoming festive season to post a turnaround. So, how long do you expect the slowdown in automotive industry to continue?
Buzz in Market

ICICIdirect Research Posted on 05:56pm 22-Jul-2019

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Which segments should the Government target to reduce the GST rates?

GST, India's biggest tax reforms have recently completed two years since its implementation in July 2017. It has helped to significantly improve the number of registered buyers i.e. enabling to widen the tax base. In addition, the government has been able to maintain compliance. Further, there has also been a rationalization in GST rates over the past two years. The next phase of GST is expected to result in further simplification of compliance procedures, rationalization of rates and other reforms and initiatives. Which segments do you feel should the government target reduction of GST rates?