GST will lead to disruption initially: Dipan Mehta, Member, BSE & NSE

In a conversation with ET Now, Dipan Mehta, Member, BSE & NSE, says that even if the Goods and Services Tax ( GST) bill gets passed during this session, uncertainty would remain.

ET Now: What about the bets that have been built over logistics companies in anticipation of the GST coming through? Gati has done well. Some of the consumer names also have rallied in anticipation of their distribution cost being curtailed with this new legislation in place. Does the conviction still hold because it is going to become reality at some point down the line or do you unwind those positions?

Dipan Mehta: One thing is quite clear that in the initial few months, GST will lead to disruption. Thereafter the benefits will flow through.

At the same time there would be a few losers and gainers within the sector. That is not as yet clear because the exact legislation, sectors and the rate of tax is not completely clear and fixed as yet.

So even if GST were to get passed during this session, we would still be uncertain with regards to its implementation, timelines and sectors.

Right now, the market needs positive triggers, factors, trends, developments which will push up, say numbers for the March or June quarters.

I am a bit sceptical about this whole GST opportunity and my eyes are firmly on the quarterly numbers.

Coming specifically to logistics and other industries which have gone up on account of the passage of GST bill, investors are getting a bit ahead of themselves over there. Once the euphoria is open and you see the quarterly numbers coming up in the logistic companies, there would only be disappointment.