Quote on Budget Reaction by Sandeep Chordia, COO, Kotak Securities
Below the Quote on Budget Reaction by Sandeep Chordia, COO, Kotak Securities
The most reassuring aspect of the budget is that fiscal consolidation remains firmly on track, with the fiscal deficit continuing on a credible glide path while still supporting growth. This balance between fiscal discipline and growth orientation sends a strong signal of macro stability.
From a taxation and investment perspective, taxing share buybacks as capital gains instead of dividends is a positive move for shareholders, as it lowers the overall tax incidence. Allowing persons resident outside India to invest directly in listed Indian equities will expand the investor base and is clearly positive for the stock markets, particularly in terms of long-term and stable capital flows.
The introduction of a formal market-making framework in corporate bonds is an important structural reform that should materially improve liquidity, depth, and price discovery in the debt market.
On the flip side, the increase in STT on F&O trades is a near-term negative and may impact trading volumes and market activity in the short run.
Finally, the new Income Tax Act, effective from April 2026, is a step in the right direction as it simplifies tax laws, removes interpretational ambiguities, and eases compliance. Overall, the budget reflects fiscal prudence combined with targeted reforms to support sustainable growth
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