Market Bearish In spite of GST Reforms | CA Rachana Ranade

"I will tell you when I got to know that insurance just just understand the nitty-gritties. Okay. when I got to know insurance is exempt 0%. But when we read the fine print or when we read the FAQs, uh we can understand finer details, right? It is given that you will not get GST credit if we are talking about insurance. Now please understand the impact because see why I took this live stream in spite of releasing the video because you know when I release a video there is a time limit. I can't just go on go on and on and on. Uh I had I wanted to explain the concept of GST credit just in case people don't know about it right. Uh now what what what was mentioned is that if we are talking about insurance companies all life insurancees now which life insurance it could be term insurance it could be endowment it could be ULIP all sort of life insuranceances individual life insurance or individual health insurance these will go into 0%. So no GST on premium."

"Now ideally what should happen? Ideally your GST premium should come down directly by 18%. So assume that you are paying premium of,000 rupees 1,000 rupees plus 18% GST 1180. Now ideally it could have gone down to directly 1,000. Will that happen? I don't think so. Why? Now insurance companies have been told that because you are going to fall under the 0% category, you will not be allowed input tax credit. Now what is that? ... my entire insurance outflow may not come down by 18. It will come down by lower than that. Okay, maybe 6 7% premiums may increase and ultimately it'll be somewhere around whatever 10 12%. This is just this this number is just an example but entire amount will not be passed on to the customer is is what I understand right"

"I feel FMCG sector is one of the sectors which has which will see a good you know uh impact of this GST rate because uh in this one I have not seen cases where input tax credit is going to be disallowed or anything like that. So I feel that overall FMCG is one place for people like you and me daily essentials ideally should come down. Okay."

"and as far as other little bit luxurious items are concerned uh something like luxurious cars uh be televisions bigger size televisions they are also going to come down but all in all market unfortunately has not given a big thumbs up to this entire GST revamp or what can we say 2.0 or whatever. ... luxury Cars like Mercedes fit into the 28% category right now. But believe it or not, the cess on GST is one somewhere between 1 to 22%. I mean additional cess which you have to pay and the effective rate goes up crazily almost 45% or whatever. It's a compensation sess. Uh so I've paid almost 45 50% tax on Mercedes. Uh but with this new GST uh 2.0 changes uh the GST will come down to 40% without cess so luxury cars will be a shade cheaper"

"Uh and are they going to take a dent in their revenues? Yes, they are going to do that. But still in in yesterday's press, he said please don't consider it as a revenue dent. We want to boost the economy. We want to boost the consumption. If if consumption is boosted, if demand is boosted, we'll be more than happy. And ultimately GST collections should go up in that case. Right? So I believe that uh overall maybe for a quarter or 6 months or whatever uh we may see GST collections drop a bit but ultimately over a period of one year only I feel that somewhere we should be able to see the boost in GST collections back to previous levels is what I feel."

"Uh today's candle o shattered my dreams. Uh now in fact I I feel that this level today's close 24,700 is what I would really want to watch. Uh because this is the candle which which is like an event candle post today's event. This is the this is the close that we have seen. If this is breached, this risk opens up. 400 points risk opens up. And if this is also breached, poof, we we could see that head and shoulder shoulder height going straight 800 points down. So I feel really crucial next three four days. Uh how does the market overall react? Uh really really important to see uh what what would happen next."

"So was not really happy to see how markets perform today. But many people especially when I read that input tax credit thing, I was also a little bit you know maybe market may not really uh you know give a big thumbs up."

"Prashant saying? For insurance companies, ITC is very less. Maybe rent, software, services, housekeeping, but premiums collected are huge. I feel insurance cost for consumers should come down by 10 to 12%. Absolutely. That's what I said, right? 5 to 7% is somewhere I feel uh that it that that benefit may not be passed on to us. So out of 18 entire 18 should have been passed on to us, right? somewhere 5 to 7% there will be a draw down and somewhere around so 5 to 7% is basic that's what I said right 11 roughly 11 to 13% you are saying 10 to 12% fair enough"

"So that is the logic that in the longer term the GST collection may in fact go up."

"The classic example of sell on rise market. See whenever any news is cheered by the market that is called as a buy on dip market so Market goes up on such news, goes up, continues the rally, maybe a small pullback, that will be like a buy on dip. But whenever even a good news is ignored by the market, that's a weak market. That's a sell on rise market."

"gold is going to be uh is definitely going to be an important asset class to have in your portfolio with more and more geopolitical tensions. It's a must have in your portfolio. No second thoughts"

"The webinar is going to happen on the 21st of September. It's going to be in English and it's going to be on how to use AI for doing fundamental analysis. Okay. We will be uh having a separate uh you know uh a course kind of a I mean you you can do the booking on my website rashnaran.com. It's not yet live but we have finalized the date. It's going to be on 21st of September. Uh anyone who is interested you can just drop a WhatsApp message on 9022196678 because the seats are going to be limited. I have a bandwidth of only 500 people for the webinar. Uh so anyone who is interested to know uh on how to use AI for fundamental analysis uh that's that's just the WhatsApp number you need to know just drop a WhatsApp message and the moment we make it live we will let you know."

"And remember nifty today's low or today's close is one important level. If that is breached 24,300 is one more important level. Please keep these levels in your mind."