The capex-led growth-oriented Budget augurs well for the Indian equity market, according to market watchers. They believe that the finance minister Nirmala Sitharaman has rightly focused on doing the heavy lifting by raising capital expenditure levels and investments in infrastructure space. This will benefit players from across the sectors including capital goods, cement, and steel, among others.
Following the developments in the Union Budget, the domestic equity market extended its gains for the third straight session on February 2. The 30-share BSE Sensex traded 504 points, or 0.86 per cent, higher at 59,367 at around 11.25 am (IST).
Market outlook
Amar Ambani, head of institutional equities, YES Securities said, “No negative, it is said, is a big positive. Given a growth supportive budget, our conviction is higher for another strong year for equities. We continue to bet on a structural rise in consumption in India, and a boost to the ongoing ‘unorganised to organised’ trend.
Jyoti Roy, DVP-equity strategist, Angel One said, “We do not expect any negative impact on the stock markets. The Union Budget has a clear focus on bolstering capital spending and is positive for infrastructure and allied sectors.”
The Budget estimates for FY23 showed that the government proposed Rs 7.50 lakh crore as capital expenditure for the year. The revised estimates for FY22 came at Rs 6.02 lakh crore, up 8.75 per cent against the budgeted estimate.
Stocks to buy
Sharing the list of top stocks post Union Budget, Hem Securities recommended ICICI Bank, MTAR Technologies, L&T, Polycab India, Agarwal Industrial Corporation, Gati, Borosil Renewables, JSW Steel, Prestige Estate, CE Info Systems, HFCL and Balaji Amines, D-Link, Gail, Laxmi Organics, Praj Industries and Adani Ports.
The brokerage also suggested Tata Power, Prince Pipes, GR Infraprojects, Mindtree, TCS, Exide Industries and Tata Power.
On the other hand, ICICI Securities likes L&T, NTPC, Power Grid, Coal India, ONGC, Ultratech Cement, Ashok Leyland, Bharti Airtel, Tata Communications. It further said that banking players including State Bank of India, HDFC Bank, Axis Bank, HDFC, SBI Life and ICICI Lombard General Insurance may benefit from channelising savings, insurance and credit growth.
Tata Motors, TVS Motors, Phoenix Mills, Greenpanel Industries, Alkem Laboratories, Dr Reddy’s, Gujarat Fluorochemicals, Infosys and Dabur also emerged as top picks of ICICI Securities.
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