'Tax relief will be big positive for markets'

All eyes are on Union Budget proposals that will in July show the policy intent of the new government.

- SIDDHARTH VORA

No major systemic risk is visible for Indian equities in the short term and investors should shift their focus from momentum to value and quality, said SIDDHARTH VORA, head of quant investment strategy and fund manager at Prabhudas Lilladher Asset Management, in an email interview with Nikita Vashisht.

After the post-election consolidation, do you expect a pre-Budget market rally in July? Like every Budget, this time too there is chatter around tinkering with the long-term capital gains (LTCG) tax. Investors may not want to jump into the markets at this time until there is clarity on this front. Moreover, there are expectations of some populist measures, which could impact fiscal deficit. All these factors need to be assessed, and smart money will be on the sidelines until then. Thus, I expect the markets to be range bound ahead of the upcoming Budget session. However, looking ahead to the entirety of FY25, the outlook appears promising with policy continuity, political stability, and continued government capex on infrastructure expected to bolster the economy.

As regards the Budget, what may play a spoilsport from a policy perspective?