"If the investment cycle does pick up, then companies with capex plans will also fall in the investment radar," said Shah.
Reduction of corporate tax was the kind of stimulus which the industry and markets were waiting for, Nilesh Shah, MD & CEO, Envision Capital, said in an interview with CNBC-TV18.
"Fiscal stimulus was required and these are well targeted stimulus measure especially the fact that it encourages producers or entrepreneurs to go out there and set up manufacturing operations. Thanks to the reduction in tax rates, it would leave more funds in the hands of entrepreneurs to reinvest in the business," said Shah.
He opined that the move to slash corporate tax rate will lead to earnings growth and ensure high cash flows for companies.
When asked what investors should buy, Shah said they should look at buying companies which are paying high tax rates. The sectors which are likely to benefit are consumer, financials and technology services.
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