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Aditya Trading Solutions recommend model portfolio for New Year and Budget 2017

Aditya Trading Solutions | 02 Jan, 2017  | Follow Author | Add to my Favourites 
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Indian stock markets ended 2016 almost on a flat note with NSE Nifty closing at 8174.90 which is a gain of around 3 percentage points compared to the close of 7946.35 in the corresponding period last year. On the domestic front, the year gone by has seen three major economic decisions taken by the Central government,one being the 7th Pay commission implementation, the second being the GST and the third being the ban on high value currency announced on 8th of November leading to chaos and cash crunch across the country.

On the global front also markets witnessed three major events, one being the Brexit referendum , second being Mr.Donald Trump becoming the 45th U.S President and third being the Fed decision to hike key interest rates by 25bps.Global stock markets tumbled due to the unexpected and surprising moments like Trump’s victory and Brexit referendum.However stock markets recovered and in the U.S,all the major indices have set all time high records.US dollar is rising all since Donald Trump was elected the 45th president of the United States of America.

Trump’s win could bring new era of uncertainty for the Federal Reserve. Under the Obama administration the Central bank has been kept insulated from the political critics for the past eight years. However, in Donald Trump the Federal Reserve will face a president who has expressed varying views about its policies,supporting low interest rates some times and opposing them at others.So, if we analyze some of his comments during the final days of his election campaign we can find that he is someone who might not feel bound by the tradition of recent presidents staying silent on monetary policy. He might also be willing to work with the GOP controlled Congress to rewrite the laws governing the Fed’s structure and disclosures, possibly embracing proposals central bank officials have seen as threats to their policy-making independence. Donald Trump is viewed as a wild card, lacking a track record in government and offering few or contradictory policy

details.While the U.S. macroeconomic cycle may get a boost from the proposed fiscal stimulus, corporate tax reform and deregulation, both the passage and efficacy of these measures are far from certain at this moment. So, in short we think that, fundamentally, risks for equities in 2017 are higher compared to 2016. We expect an increased level of geopolitical risk and increased uncertainties related to the new U.S. administration.

Now, lets focus on our domestic market. We should not think that the demonetization is the one and only step as the PM himself has hinted that several such measures are expected to be announced in the near term to bring in more transparency and control inflation and black money.

On the domestic front, the main event that everyone will be watching out for will be the Union Budget 2017. The upcoming budget in many ways is definitely unique, firstly, it is going to be presented on a much earlier date of 1st February as opposed to the usually date of 1st March, secondly, for the first time, the Railway Budget will not be a separate event and will be incorporated into the General Budget.So, upon analyzing the run up to this upcoming budget, we know that our economy was growing at a rapid pace registering GDP growth of around 7.6% but suddenly lost some steam as a result of the unexpected demonetisation announcement.

Even though how good was the decision to ban old Rs.500 and Rs.1000 notes to combat the combating black money issue, it has caused significant liquidity issues in the economy. As of now demonetisation is expected to have lasting impact on a number of segments including automobiles, FMCG and a plethora of other cash-hungry businesses.So, while considering the weak sentiment surrounding the run up to this budget, everyone is expecting some populist policies in the upcoming Union Budget 2017-18. We have identified some of the key expectations from Budget 2017-18 and is given in the next few pages followed by our stock picks for the New Year and Budget.


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About Aditya Trading Solutions

Aditya Trading Solutions (ATS) is a full spectrum INVESTMENT MANAGEMENT house specializing in equity and commodity trading. We are one of the earliest members of MCX and pioneers of online commodity broking in Tamilnadu. Services offered include trading in Equity, Commodity, Currency, PMS and SIP. ATS is promoted by young and dynamic entrepreneurs who have years of proven experience in international derivative markets like NYMEX and worked with several FORTUNE 500 companies. ATS is the largest online commodity trading company in Tamilnadu. Its client base consists of a long list of satisfied institutional and retail client base broking. Headed by Mr. Rethish Varma S, who has several years of experience in Equity Research after having worked with COPAL AMBA a Moody's Analytics Company, HDFC Securities Ltd and Doha Brokerage and Financial Services Ltd. ATS possess an experienced and qualified team of research professionals offering unbiased advice on investment decisions. ATS can be accessed at


For more information please write in to [email protected]

Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor accept any liability whatsoever arising from the use of any of the above contents.

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