E-gov companies are here to gain

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E-gov companies are here to gain


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March 02, 2007 17:28 IST
New taxation norms ruled the questions the readers asked market analyst Sharmila Joshi in an hour-long chat on Friday. Apart from answering the queries, Joshi also provided some valuable insights into this year's Budget. Here is the transcript:

sharmila Joshi says, Hi, Sharmila here. A very warm welcome to all

Ravi asked, Is it true to blame future market for inflation?
sharmila Joshi answers, at 2007-03-02 15:59:03Not really. The FM also in a speech post budget said that he does not know enough. So it is strange that they should do this ...

Murali asked, Hi sharmila, I want u t take on cement stocks few months back u were very bullish on cement and had recomended many good cement stocks so what is there future
sharmila Joshi answers, yes i was bullish. As you saw cement majors increased prices today.

wed asked, Do you think this year's budget is but last year's named anew?
sharmila Joshi answers, the budget is a continuation of a theme so in that sense yes. of course if agriculture continues to pull the GDP down its only natural that greater attention will be focussed on that

sad asked, It's pathetic that this Budget has nothing for salaried individuals.
sharmila Joshi answers, but there is hope coz the FM has said that he is waiting for a report on the tax structure and will then take a call

GaneshNadar asked, On one hand the FM says it is his priority to build the infrastructure and on the other he increases the price of cement. Any idea why ?
sharmila Joshi answers, perhaps to contain inflation which at the moment is a bigger worry. THis could be counter productive move coz cement cos have raised prices!

ramu asked, Hi, SharmilaWill how much IT companies suffer because of MAT
sharmila Joshi answers, They already pay a tax on their domestic business - this MAT will now apply to their profit earned overseas - most companies have said that their bottom line would be hit by about 1.5%

dinny asked, Hi,Sharmila what will be the impact of budget on stocks like Mcleod Russel
sharmila Joshi answers, none. tea prices have been depressed anyway

Ganesh asked, The Market fell on that day and recovered the next day. Does that mean that the budget had no effect on the market
sharmila Joshi answers, yes and no. market fell largely due to events in china - so its difficult to estimate what the budget impact was

Rima asked, Do you find any logic in FM raising exemption limit to 110,000and at the same time raising cess by 1%? How is it going to help the salaried?
sharmila Joshi answers, he only increased the exemption to make sure you escape the cess burden. its a token. we have to wait for the report for more..

indur asked, what is the best and worst thing about this Budget
sharmila Joshi answers, the best thing is the continued focus on agriculture and education the worst is that he has caught the urban tail and there is nothing in it either for corporate india or individuals like you and me!

Amy asked, Has any of the measures taken by the FM will help control inflation?
sharmila Joshi answers, certainly. fiscal policy operates with a lag. this means that come june we should see inflation under control and that should have an effect on interest rates etc

Gautam asked, Yes Rima...a good question....also what I don't understand is will extra cess on everything, how the prices are going to come down, because the manfacturers are not going to pay from own pocket....but obviously pass them on to the consumers.....
sharmila Joshi answers, everyone has to pay cess - but i am not complaining coz its for education - so atleast it for creating value in the future

sudhir asked, what is the definition of aam aadmi? are salaried people classified as aam aadmi as per FMs definition. This budget has nothing for the salaried people.
sharmila Joshi answers, a vast majority does still depend on agriculture - so i think this budget was more pro farmers, students - we will have to wait for our day

sudhir asked, Sharmila, it seems Govt has hit a Goldmine by way of service tax. However is it not amounting to double taxation on the individuals who pay their Income tax and then have to pay service tax on services they use for telephone,courier,hotels. As you know they pay for these services from their hard earned income net of income tax.Can this not be challanged in court ?
sharmila Joshi answers, one bad thing in the budget is that now those who are leasing out property for commercial use will ahve to pay 12.5% service tax. it beats my mind how renting property is service. i have no idea if it can be challenged in court

ahu_10 asked, helllo , wanted to know whether AKruti nirman and ansal propertis should be bought as they are beaten down a lot
sharmila Joshi answers, yes i think so. now the valuations do seem more attractive. but wait a bit markets look like they are correcting. i would prefer ansal

ahu_10 asked, helllo , wanted to know whether AKruti nirman and ansal propertis should be bought as they are beaten down a lot
sharmila Joshi answers, yes. but wait a bit. markets are correcting. i prefer ansal

raghavan asked, Hi, sharmila what will be impact of budget on petrolum products
sharmila Joshi answers, there is a reduction in ad valorem component of excise duty on pertor and diesel from 8% to 6%. this will benefit IOC and other downstream cos

Mahesh asked, Does the inflation rate affect the market
sharmila Joshi answers, yes it affects our lives. if we have less to spend then how will money find its way to anything - from loans on cars/property to markets

Manjinder asked, Sharmila, can you please tell me that the prices of computer and mobile phones will rise or decrease due to this budget???
sharmila Joshi answers, imports will be cheaper - as peak duty rates have been cut. so should get cheaper

rock asked, what is ur call on sugar and reality stocks.. .. beaten already quite a much.......
sharmila Joshi answers, sugar has no positive fundamental trigger as yet. but have bottomed out. wait for a little clarity on real estate... also be stock specific

paisewala asked, Sharmilaji, the budget being what it is, the interest rate scenario & inflation not benign, most FIIs viewing india as expensive, the political setbacks for the UPA & the ensuing elections in major states, will it be wise to be bullish on the markets? ( enough of this crap about ' india story ').
sharmila Joshi answers, global concerns will continue... markets will be volatile but a 9.2% GDP is not crap by any standard. so keep the faith.

sushant asked, budget is for middleclass or farmers or for rich pepoles?
sharmila Joshi answers, it should ideally be for all. however as you know the weakest link has to strengthened and that is the effort in this budget.

Titu asked, Why are you skipping the questions. If you don't have the answer just say you can't answer on this subject.
sharmila Joshi answers, i am sorry there are too many questions. could please repeat yours

abhi asked, The budget doesn't reflects the Govt. investments towards SEZs. Shouldn't FM comment on this issue as well?
sharmila Joshi answers, yes clarity is required urgently on that issue. the roadmap going ahead for a lot of sectors does depend on that

badri asked, what is the plus in this budget?
sharmila Joshi answers, i think there is an upside for companies in egovernace work - IT, education as a whole - paper related, hotels - esp with project in delhi, pipe cos - like welspun guj, mah seamless

dinny asked, Will markets correct more?
sharmila Joshi answers, yes, i think so. i do not get the sense of value buying yet

badri asked, how about tuf scheme?
sharmila Joshi answers, its the technology upgrdation fund - its been extended and the amount increase to 911 corre - a positive for textile cos

archana asked, WILL WE GET SAME RETURNS FROM MUTUTAL FUNDS AS HAPPENED LAST YEAR
sharmila Joshi answers, not on liquid funds for sure - the tax increased to 25%. the rest will depend on how the funds perform with relation to general markets

Sia asked, How good is investing in current scenario??????when the market is so volatile????
sharmila Joshi answers, one should invest with a long term perspective and use dips to add stocks.

Sia asked, Will it be good to pick RNRL at this time??????And what about the shares of IT companies??????????
sharmila Joshi answers, do not like RNRL. IT for sure.

Rajesh asked, How long will the stock market boom last?
sharmila Joshi answers, keep an eye on earning and country growth - that is the INDIA STORY. markets have been a slave to earnings.

Satya asked, When you talk about clarity, a significant amount of focus is given on futuristic investment of the goverment. Don't you feel that it doesn't reflects any accountability of the goverment on people's money?
sharmila Joshi answers, i am sorry could you explain your question more

Rajesh asked, Talking about SEZ, why doesnt the Government ask the private sector to buy the land it needs from the public
sharmila Joshi answers, i do not think that buying land is the issue - there are issues with using agricultural land etc

krishna asked, Is there any change of tax rate for foreigners investing in India?
sharmila Joshi answers, None

archana asked, WHAT IS LIQUID FUND DO U MEAN OPEN ENDED???
sharmila Joshi answers, No these are funds which invest in money market - debt related instruments

sahul asked, hi sharmila, i seen ur advices with CNBC and NDTV profit, pls tell me, i hold 500 shares of Hindustan zinc@800, what will be the impact of the budget on this script?
sharmila Joshi answers, its a stock i like. however overall commodity plays will not be fancied much for some months

hariharan asked, I still can't figure out the why's and wherefore's of the cut in import duties for dog and cat food. Any reason why the FM gave so much importance to it.
sharmila Joshi answers, it was meant in a lighter vein. i am in favor - i like cats

TheGeek asked, Sharmila, I have always been a long term invester and have always used the sensex dips as to invest the money however now I could see that rather than being a long term invester if I would have churned money and retrieved money I would have gained however not market. Please comment on this?
sharmila Joshi answers, i do not agree. it is good to sell and realise profits but trading largely results in greater profit to your broker

krishna asked, Do you support that the present Budget had a high impact on IT industry, which may badly effect IT Professionals?
sharmila Joshi answers, not really. MAT will effect bottomlines by 1.5% - which is what industry has said. the guidlines for FBT are awaited.

gdfvgd asked, Taxing agriculture can broad base tax collection? your opinion!
sharmila Joshi answers, yes - but first we must wait for their productivity to go up. the irony is that no tax being collected from farmers has only benefitted the rich farmers to get richer. the trickle down has not happened

sid200 asked, The service tax exemption limit has been increased to 8 lacs. Will the service providers have to apply for exemption or its automatic for those service providers whose turnover in the year 2006-07 was less than Rs.8 lacs
sharmila Joshi answers, don't know. will have to check that

kut123 asked, what is your opinion abt the cement sector, do you thing it is a good for long term
sharmila Joshi answers, no. there seems to be need for a debate with the cement manufacturers. a dialgue - if the objective is to contain prices its not working

gdfvgd asked, Will it be possible to tax agri? Given that 2/3rd depends on Agriculture as per statistics, and which I have been hearing since my school day in late 80's.
sharmila Joshi answers, ;-) true - it seems that day is too distant. but every economy goes through phases - now the biggest contributors are service industry and so we get taxed for it

hshankar76@rediffmail.com asked, Everybody is talking about their own benefit but nobody talking about the person who feeds them. what do you think about it.
sharmila Joshi answers, i agree. even for our benefit its essential that the non-performers start giving results - then we will be firing from all guns

indrani asked, Hi Shammi, How are you?
sharmila Joshi answers, fine

Rajesh asked, What is mid term gain ? how many months or years does it stand for
sharmila Joshi answers, long terms is 3-5 years mid term is between 1-3 years and short would be a year. however market does not follow this. for the market 1 year is long term!

pdu asked, for service tax is the limit of 4 lakhs (w.e.1-4-07 8 lakhs) applicable per Financial year or in cumilative from day one. i.e say 3.8 lakhs in f.Y.06-07 and say 7.6 next F.Y 07-08
sharmila Joshi answers, i think its 8 lakhs after the budget is cleared

pdu asked, Sharmila can you please reply to my query on service tax
sharmila Joshi answers, i thinks is 8 lakhs for current year after financial bill is cleared by the house

kuty asked, pls tell me, i hold 800 shares of satyamcomp@ 469, what will be the impact of the budget on this script?
sharmila Joshi answers, MAT and FBT on esops are the negative. but to my mind not much.

hshankar76@rediffmail.com asked, Sharmila, What do you say about Budget.I see very good points than bad points like promoting the agriculture sector which is a base of india. That sector also can bring huge amount of economy boost in india in near future if FM promotes in a right direction. You haven't answered this question.
sharmila Joshi answers, yes there are many good points. what i like is that even for agriculture and educations they way the benefits have been given is very interesting - irrigation, seeds, higher education etc

pdu asked, Don't you think if less agricultural lands were taken for the purpose of industries, less farmers will be displaced thereby letting farmers continue with farming rather than changing their vocations to industry. We will face a situation of a lot of industries but no food!
sharmila Joshi answers, yes - prima facie i agree - but does not always work that way - SEZ do offer immense employment opportunites - CHina model

samyu2 asked, which sector is going to be effected with the increase in customs duty?
sharmila Joshi answers, private aircraft import iron ore - sesa goa and all steel cos

Saina asked, Is it good to invest in RIL??????
sharmila Joshi answers, yes - but again long term ie 1 year plus

samyu3 asked, hi sharmila, in which sector can i invest at this stage?
sharmila Joshi answers, pipe companies irrigation e-governance education

Rajesh asked, In the market is more money coming in from abroad. Or are Indian companies sending out more money by buying foreign companies
sharmila Joshi answers, after the tata deal india has invested more overseas

iamvss asked, Budget doesn't have anything on FDI in retail sector (or just that I missed it)
sharmila Joshi answers, nothing. it was something that i too waited for. but the trend has been to address contentious issues outside budget

Warren_Buffet asked, How does IDFC look....short term (1-3months),long term(1-2years)?
sharmila Joshi answers, good for long term

sathish asked, can i join sharemarket
sharmila Joshi answers, most definitely - but as an investor

sid20 asked, Friends, seems Sharmila is not comfortable with service tax, so please do not bother her on service tax queries
sharmila Joshi answers, how right. i am up to my neck in questions and your question is way too specific

sugat asked, Hi Sharmila, would do you make of the realty sector. Specefically I have Unitech at 480 levels. Should i hold or sell.
sharmila Joshi answers, i continue to like unitech. but overall real estate stocks are going to correct

iamvss asked, I expected the budget to tax the second house (or more houses) higher.
sharmila Joshi answers, in a way they have - for if you are renting property for commercial purpose a service tax has been introduced which is a whopping 12.5% - a month's rent!

sharmila Joshi says, bye. thanks. it was great fun for me. i hope it was for you too.


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