Happy New Financial Year 2024-25

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Dear All,

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?The start of a new financial year brings with it a sense of hope, excitement, and fresh opportunities. During the initial months of the fiscal year, companies conduct performance appraisals, leading to promotions and salary increments for employees. However, recent times have also witnessed layoffs, even among large firms and startups, resulting in uncertainty for many. As we step into this new year, I believe it will be a pivotal time for AI technology. Those who embrace it will reap benefits, while those who resist may find themselves at a disadvantage.

For self-employed individuals, the new fiscal year provides an opportunity to evaluate their performance from the previous year and plan ahead. Budget announcements each year impact the cost of various items, making some more expensive and others more affordable. This trend is likely to continue in the current fiscal year.

In FY 2023-24, there were hopes of economic recovery, but unfortunately, progress stumbled in the last quarter. Regulatory actions by the Reserve Bank of India (RBI) against major fintech companies, such as Paytm, underscored the importance of compliance.

Looking ahead, we anticipate positive developments for the nation and its people in this fiscal year. Despite global challenges like the Russia-Ukraine conflict and the Israel-Palestine situation, the Indian economy is expected to recover strongly. However, volatility remains a concern.

One significant event that will shape India’s future is the upcoming Lok Sabha elections. As we move forward, let’s explore some of the new developments expected in this fiscal year:

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1. MCA Regulations: E-filings for various MCA regulations, including Acceptance of Deposits, MSME, Beneficial Owner, and E-form DIR-3 KYC, are spread throughout the year. While issues related to the V3 portal have improved, some challenges persist. It remains to be seen whether these obstacles will continue or ease as the year progresses. Small entities might consider alternatives beyond forming traditional companies.
2. GST: The government continues to make adjustments to GST rules and laws. Rates for several commodities have changed, and the merger of key GST rates remains on the agenda.
3. Income Tax: No significant changes in income tax rates for individuals were announced in the interim budget for FY 2024-25. The new tax regime will become the default unless individuals choose otherwise. The government’s stance on tax benefits, especially in the Insurance and Health Insurance sectors, remains uncertain. Waiving smaller legacy tax outstanding provides relief to small taxpayers.
4. Elections: Elections for several states and the Lok Sabha are scheduled, including the politically crucial state of Andhra Pradesh. The ruling party is confident of victory, while opposition infighting adds weight to this theory. A win for the current regime would stabilize the economy, but there’s concern about India moving toward a single-party or authoritarian system.

5.???? ?Stock Market Volatility:

The stock market has experienced significant fluctuations in the past few days. These sharp declines have implications for?initial public offerings (IPOs)?of leading companies, potentially delaying their launch dates.

Tech companies, which previously enjoyed successful IPOs, are now facing scrutiny regarding their valuations. The subsequent rapid decline in their stock prices has highlighted the?high volatility?inherent in these tech stocks.

6.Oil Prices and Household Finances:

Despite India’s substantial oil purchases from Russia, diesel and petrol prices have not decreased significantly. This situation has put a strain on household finances across the nation. The government aims to engage with stakeholders to bring diesel and petrol under the?Goods and Services Tax (GST)?purview. Additionally, they are exploring alternative sources of crude oil to maintain a balance between supply and demand. While there has been a slight reduction in cooking gas prices, this may be a temporary measure, especially considering the upcoming elections.

7.India’s GDP Growth Forecast: The?International Monetary Fund (IMF)?predicts India’s GDP growth rate for the fiscal year 2024-25 to be?6.5%. Overall, this indicates steady progress despite the challenges faced

8.Investment Landscape: The varying growth rate projections from different agencies make it challenging to ascertain the actual economic scenario. Indian retail investors played a crucial role last year by investing in the market, offsetting the impact of foreign institutional investors’ (FIIs) fund withdrawals. Sectors like?healthcare?and?agricultural technology startups?are expected to make a significant impact in the upcoming fiscal year.

Given the market’s volatility, small investors are advised to avoid speculative trading. Instead, consider long-term investments in companies with?solid financial fundamentals. The previous year was favorable for IPOs, and this trend is likely to continue. Several companies are gearing up for IPOs, making it an opportune time for investors to explore this avenue.

9.India’s Diplomatic Approach:

India has adopted a nuanced stance in major geopolitical conflicts, including the ongoing war between Ukraine and Russia and the Israel-Palestine conflict. By choosing a?middle path, India aims to balance its relations with Western powers and Arab states. The impact of this approach remains to be seen. As the year progresses, the?United States elections?will take place. The outcome of these elections will have implications on global dynamics.

Concluding Remarks

Each financial year brings its own set of challenges and opportunities. While it’s impossible to predict all aspects, the hope is that this fiscal year will fare better than the previous one.

Despite uncertainties, my team and I remain?committed?to providing our clients with?real-time updates?and effective solutions.

Remember, adaptability and informed decision-making are crucial in navigating these complex times.

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Quote

You may say I’m a dreamer, but I’m not the only one. I hope someday you’ll join us.?And the world will live as one.” –? John Lennon

Regards

Neeraj

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