Budget 2017: Game-changing taxes will provide sense of direction: Edelweiss

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Game-changing taxes such as modifications to the Long Term Capital Gains regime, if announced in the Union Budget, will be important from the direction point of the view, said Vikas Khemani, President and Chief Executive Officer at Edelweiss Securities.

Speaking to CNBC-TV18, Khemani said that fiscal deficit would be the number to watch and the Budget speech would be important to get a sense of the overall state of the market.

He said that he does not expect any ‘change of course’ initiatives, adding that the impact of the Budget on the markets will be short-lived unless drastic changes are announced.

“From Monday, we will probably forget about the Budget, at least in terms of the market,”said Khemani.

He said the fate of the markets will ultimately depend on earnings trajectory.

On long-term capital gains, Hiren Ved, Director & Chief Investment Officer at Alchemy Capital Management, said that markets won’t take it lightly if a tax burden was imposed on LTCG.

He said that while tinkering with the time period of LTCG is expected, there would be nothing in the Budget to “rock the boat”.

On banks, Ved said that PSU banks urgently needed recapitalisation despite massive deposits post the November 8 note ban.