Economic reforms hinge on Haryana, Maharashtra poll results, says Marcellus Investment

“My strong hunch is that in this winter session of parliament we are going to see land reform. The vigour with which the NDA pursues it will depend on how emphatic the mandate they get in Haryana and Maharashtra, and to that extent assembly elections are a good pointer to how much reform we will see over the next 6 months,” said Mukherjea.

Talking about personal tax, he said, “I am not so sure they will do personal income tax cut in a meaningful way on this side of the budget. There might be token sops for income tax payers. The crux of the tax cuts on income tax should be a union budget event rather than done right now.”

About earnings, Mukherjea said: “Results such as L&T and HDFC Bank and Kotak underscore that the overall picture is not so bad. We do have a problem in the NBFC space and it’s going to go away very quickly; that creates a massive issue for the auto sector. There is also working capital crunch generally in the country but it’s not as if the world is going to fall off a cliff vis-à-vis consumption as most people seem to believe.”

“Hence I stick to the call I made two years ago that we are going to see massive consolidation in the NBFC and housing finance ecosystem over the next 6 months or so,” he further added.