Rakesh Jhunjhunwala is very bullish about the Indian economy and market. He says that the tax collection in the country is skyrocketing and the country is on the verge of a big change. Despite this, BigBull is not very enthusiastic about the startup. He is in favor of keeping distance from the new generation technology based companies.
CNBC-TV18 In a conversation after the Union Budget, he said that the net tax collection in the current year has been more than Rs 3-4 lakh crore, which is much higher than the estimate for the financial year 2021-22. He also said that the country’s fiscal deficit will be 1-1.5 percent less than the budget estimate, which indicates that the country’s tax collection will be more than Rs 4 lakh crore next year. However, this in itself is a conservative estimate.
Let us inform that in the April-December period of FY 2022, the gross tax revenue of the country was Rs 19.29 lakh crore while the net tax revenue was Rs 14.74 lakh crore.
The government has increased the gross tax revenue estimate to Rs 25.16 lakh crore and the net tax revenue estimate to Rs 17.65 lakh crore for the fiscal year 2022. Similarly, the Gross Tax Revenue Estimate for the financial year 2023 has been kept at Rs 27.58 lakh crore while the net tax collection for the period is estimated at Rs 19.35 lakh crore.
Similarly, in the current financial year, the fiscal deficit has been estimated at 6.9 per cent of GDP. Similarly, in the financial year 2023, it has been estimated to remain at 6.4 percent.
In this conversation, Rakesh Jhunjhunwala has said that the market will be seen performing well going forward. We are losing the forest just for the sake of a few trees. The government’s focus on improving tax rules is showing its impact. The government’s target is to achieve 8-8.5 per cent GDP growth. Going forward, GDP growth can be seen to go up to 8 percent and after that to 10 percent.
He further said that investors from all over the world want to invest in India. India has a clean, tidy and regulated tax law. There has also been a lot of progress on the ease of doing business front. The China Plus One factor doesn’t seem to be taking effect in a big way yet. We have crossed the credit cycle. Now the capex cycle is standing in front of us i.e. investment in the country will be seen increasing. He further said in this conversation that we should keep in mind the words of Kumar Mangalam Birla, Adani, Mukesh Ambani who say that they will make big investments in the country.
Rakesh Jhunjhunwala says that in the future, we can see private sector investment beating the public sector investment. He said in this conversation that despite the state elections, the government has stayed away from making the budget too populist. We are fortunate that we have invested in the market. I am bullish on both the market and the economy.
Rakesh Jhunjhunwala believes that India is nearing a big change. Ease of doing business, privatization, good and transparent tax laws, curbing the arbitrariness of bureaucracy are signs that we are on the right track. Reform is a definite process and we seem to be on that path.
Where to invest? Responding to this question, Rakesh Jhunjhunwala said that public sector banks will perform very well going forward. Their valuation is very cheap. In this conversation, he further said that what you are buying is more important than what valuation you are buying. Stock prices often depend on a company’s cash flow and earnings. He said that I would prefer to stay away from startups. Talking on cryptocurrencies, he said that the government wants RBI to promote cryptocurrency.
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