Tourism stocks gain as FM says govt will give interest free loans to develop tourist centres

Shares of tourism-related companies traded higher after finance minister Nirmala Sitharaman on February 1 announced that long-term interest-free loans to be given to states to develop tourist centres. Following the announcement, Thomas Cook (India) climbed 4.55% to Rs 180.50 at around 12.30 pm (IST). On the other hand, the benchmark BSE Sensex traded 8.32 points, or 0.01%, up at 71,760 at around the same time. Easy Trip Planners was up 0.53% at Rs 47.33. Shares of Yatra Online also gained as much as 1 per cent during the trade.

While presenting the Interim Budget 2024, Sitharaman further said that our middle class also now aspires to travel and explore. Tourism, including spiritual tourism, has tremendous opportunities for local entrepreneurship.

“States will be encouraged to undertake development of iconic tourist centres to attract business and promote opportunities for local entrepreneurship. Long-term interest-free loans to be provided to states to encourage development,” she said adding projects for port connectivity, tourism infrastructure and amenities will be taken up in islands, including Lakshadweep.

Pradeep Gupta, Co-founder and Vice-chairman, Anand Rathi Group said, “The FM has continued to focus on strengthening of domestic macro factors including sustained investments in infrastructure, agriculture, domestic tourism, and also sticking to fiscal responsibility with a lower fiscal deficit which could be music to the ears of foreign investors and impending $25 billion bond inclusion in June as lower budget deficits and pared borrowings will help bring down yields. It could open the door for a ratings upgrade.”

He further added that key features of the budget are focused on infrastructure, tourism, logistics and innovation in research. All these measures will bring continuous sustainable growth to the economy. This shows the continued commitment of the existing government to move towards bringing fiscal prudence and reaching to the targeted fiscal deficit of 4.5% of GDP by FY26.

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