Uday Kotak Cautions Against small, mid cap stock
Uday Kotak as one of the representatives from India at the Davos World Economic Forum asked leaders to start looking at the macroeconomic scenario of the financial front as challenges have started emerging.
While speaking about the micro trends in the Indian economy, Uday Kotak, one of the eminent bankers of the country said though the equity market is performing great, there should be special attention towards the mid-cap and small-cap stocks.
He went on to say at the annual meeting of WEF that India needs jobs and also need to maintain a balance between the domestic requirements and international standing. Siting the example of recent tax cuts in United States, Kotak said India needs a step like President Donald Trump who has improved the job market in America by reducing taxes.
The WEF meet which took place in Davos from January 22 to January 26 this year saw a number of world leaders speak about the economic scenario of their respective country and the world, including President Donald Trump and Prime Minister Narendra Modi.
Uday Kotak also said that previously macro was good but micro was challenging; but recently the microeconomic scenario is stable but macroeconomic scenario is getting challenging day by day. While the domestic formalization of the companies is helping India, the macroeconomic issues are coming from petroleum and commodity products. The current account deficit has increased in the present fiscal year; India will try to decrease its fiscal deficit to 3.4% this year and further to 3.2% in the next year.
When asked about his expectations from the upcoming Union Budget, Kotak said while the Finance Minister is trying to raise revenue, the minister must keep in mind that the world is moving towards reduced income tax rates. This is a major challenge to the Indian government how collect revenue without increasing taxes.