Do it yourself

Last weekend I had an opportunity to address a gathering of stock market intermediaries. The interface provided some useful insights which I find pertinent to share with the readers. All the participants deal with small and medium sized household investors and traders, commonly referred to as the Retail Investors. The common refrain was that the recent stock market rally has not benefitted the retail investors. Most of these investors are stuck with the struggling mid and small cap momentum stocks which are down anywhere between 25%-75% from their cost of acquisition and no hope of recovery. To make the matter worst, many of their active clients are still looking to buy the fallen angels, the stocks where the equity value is negligible or even negative in some cases. Most popular stocks with this segment are stock of JPA group, ADAG Group, Jet Air, DHFL etc. Tata Motors, SAIL, Nalco, Coal India and Yes Bank are some of the stocks which have perhaps disappointed t...

The sudden changes announced in corporate tax structure last week galvanized the Indian stock markets. It has turned the sentiments by 180 degrees from extreme pessimism to extreme optimism within a matter of few hours. Not only the stock market participants, but all the corporates have also been positively surprised by this sudden announcement. The move has been welcomed by businessmen almost unanimously. The decision to change the structure of corporate tax is not totally unexpected as this structure has been part of almost all versions of "New Direct Tax Code" that has been a work in progress for past one decade at least. However, the timing and method (through Ordinance) just 2months after announcement of full budget caught the markets by surprise. Many readers have asked for my views on this decision to suddenly change the corporate tax structure, which I am happy to share as follows: (a)    I believe this decision is very good. It shal...