Moneycontrol
Last Updated : Jan 31, 2018 11:19 AM IST | Source: CNBC-TV18

Budget 2018: Happy to see correction in small & midcaps; do not see LTCG in this Budget

The Nifty50 rose over 5 percent while the stocks in the small and midcap space have corrected by nearly 60 percent so far in the year 2018.

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The S&P BSE Small & Midcap stocks have underperformed benchmark indices so far in the month of January, but it is a healthy sign and investors should not worry about it too much.

The Nifty50 rose over 5 percent while the stocks in the small and midcap space have corrected by nearly 60 percent so far in the year 2018.

“It is good that the small and midcap segment is not running away rather there is a correction which is happening. Possibly there should be both time as well as price correction,” Krishna Kumar Karwa, MD & CFO with Emkay Global Financial said in an interview with CNBC-TV18.

Karwa further added that market has already factored in positive earnings expectations from India Inc. for the quarter ended December 2017 which what is now started reflecting in the stock's reaction.

The companies which are announcing their results at least in the mid-market segment have come more or less in line with analyst expectations but the stock has possibly stayed flat or has corrected which suggests that market has discounted improved earnings in many sectors.

Commenting on the Budget and the possibility of LTCG coming into the picture in the upcoming Budget, Karwa said that the execution of LTCG is more difficult than current STT.

We believe that govt is pragmatic enough to understand the implications of such moves. But, let’s say if the LTCG get implemented or the government decides to raise the time period from current one year to say two years, which would only lead to a knee-jerk reaction.
First Published on Jan 31, 2018 10:16 am
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