A Lion’s eye on the Bulls and Bears

“In India, companies may fall sick, but promoters rarely do!”

Gaurav's Blog


Day: February 28, 2011

Muted Expectations from the Union Budget….and the FM delivered on cue…..Sensex rally of 500 + Points had to reverse

Immediate Take on the Union Budget


Nothing much was expected from this Budget and our FM met these expectations…..I had not expected any Amnesty Scheme or bold vision or dramatic reform announcements….too many pressures and pulls and compulsions being faced by this UPA Government currently


Markets were however buoyant from Morning and post budget speech Sensex surged over 500 points at one time reaching 18297 prompting me to alert clients that these gains will reverse….they did by over 400 points in the last hour or so,although Sensex closed up 122 points….more a relief rally really + some short covering


Macro Concerns are yet intense…Interest rates…Inflation…Oil Prices….global tensions in MENA…..FM really had his hands tied

…with inflation high he had to put monies into the hands of the People…his Direct taxes sops will lose Rs 11500 crs for the Government….he is recovering these from Indirect Taxes

…..he seems to have misunderstood what we wanted for our Infants and Women !…he has reduced the Excise Duty on Diapers and Sanitary Napkins from 10% to 1% !


He also seems to have worked backward to put a lid on the fiscal deficit….gave a % & number to it…4.6% of GDP at 4.12 lakh crs,lower in % terms but slightly higher in absolute terms than this year, and then adjusted other heads !…for example subsidies ,especially fuel look too low at Rs 23000 + crs

….he has targeted 9% GDP Growth rate for 2011-12….looks challenging as in 2010-11 we have seen 8% + every quarter…and Corporate Earnings may be impacted next fiscal year as Interest Rates remain high

….and the Deficit will continue to be funded by strong Government Borrowings of Rs 3.43 lakh crores…with this pressure and high Inflation  expect Interest Rates to firm up some more !…they are already at 10% levels


Markets got an unexpected  positive in that FM announced that Foreign Nationals that meet KYC norms will be allowed to invest in Equity Schemes of SEBI registers Mutual Funds….this opens out a whole new class of investors to tap…..KYC norms would mean these Foreign nationals would require PAN numbers 


Direct cash Subsidies to Below Poverty Lines Indians for LPG,Kerosene and Fertilisers in a good first step to eliminate malpractices in subsidy distribution….UID is yet a year away to use as an efficient platform for financial inclusion and distribution of resources   read more

Live from the Oscars to a near Octogenarian delivering Union Budget Ointment

A new week commences as February ends…Got up early to watch Live on ‘Star Movies’ the 83rd Oscars Awards Presentation Ceremony….new and younger hosts in an attempt to make the Oscars youthful and livelier and more ‘yo’ and ‘wassup’…...James Franco and Anne Hathaway…Great Actors…not so Great Oscar Hosts…needed host of earlier years Billy Crystal and some Award Winners and Award Presenters like Sandra Bullock to pep up the evening…. Colin Firth won Best Actor in a leading Role for ‘The King’s Speech’…This superb Movie had Twelve Nominations and won Four Oscars for Best Original Screenplay,Best Director,Best Actor in a Leading Role and Best Motion Picture….The King,Colin Firth’s subtle English wit when delivering his Gratitude speech for winning stole the show and showed why the Queen’s English remains up there ! against rebelious American Slang

Now I’m hearing Live, and I must confess not to eagerly as I did in the past,to a near Octogenarian,Finance Minister Pranab Mukherjee…he’ll turn 76 this year…delivering  Ointment for our Economic Woes in his Union Budget…Tightrope Walk…Pragmatic or Populist ?…..Challenges of  Inflation,rising Oil and Food prices,Deficits, Corruption and Governance issues,Internal and External Security Concerns….let’s hear what he has to say…….  

Scroll to Top