Post-Budget Quote - George Alexander Muthoot, MD - Muthoot Finance Ltd

Overall the budget is good, though not an excellent one:

1. Increased allocation for social sector as well as food security will benefit the poor in a big way

2. Investment allowance of 15 % on investment above 100 crore, increased allocation for rural and urban housing, Development of 3000 Kms of road, credit enhancement by IIFCL to companies , additional tax cut of Rs 1 lakh in respect of investment on home loans up to Rs 25 lakhs , exemption of custom duty on import of machinery and semi conductors would encourage investment

3. Budget is good for capital market and mutual funds

4. Dedicated debt exchange would deepen the bond market

5. Simplification of procedures by SEBI for FIIS will encourage FDI

6. Extension of 4% farm loan to private bank has given level play in field to private banks

7. The budget has not given any incentives for savings.

8. Budget has disappointed IT payers as the effect of inflation has not been reckoned. Proposal to impose surcharge to those assess in high income bracket could have been avoided. Instead, the tax base should have been increased by bringing more people, including agriculturist with substantial income, also in to the tax net.

9. Allowing FIIs in currency derivates would only add to the volatility of the market

10. Fiscal deficit of 4.8 % proposal appears realistic.

Source : Equity Bulls

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