Finance Minister made a surprise announcement on Friday about reducing corporate tax to 25.17 percent. The announcement led to quick jump in Indian stock markets with market players cheering the decision of Narendra Modi-led government to boost the economy. Indian economy is facing tough times and the government has announced few steps in the past few weeks. However, this one move could prove as the strongest positive step by the government.

Comments on the recent government move by Amit Gupta Co-Founder and CEO TradingBells follows....

FM has today slashed the corporate income tax rates to make the effective tax rate to 25.17% inclusive of all surcharges and cess. The markets welcomed this move with the Sensex surging over 2000 points and Nifty gaining over 600 points in trade today, its largest single-day gain in 10 years.

The move brings India in line with its Asian peers of China and Indonesia in terms of Corporate tax rates and is surely going to catch the eyes of many FPIs and FIIs, and we can see the inflows surging in the coming week.

Investors should now focus on various corporates which are currently paying over 25% taxes such as State Bank of India, United Spirits, Tata Steel, ONGC, Mahindra & Mahindra among others. These and many other scrips registered gains of 4% to 10% in trade today and could see further upside as the benefit of lower taxation materialize in time to come.