As all eyes were set on the Union Budget, that was tabled in the Parliament on Friday, the fund managers of Smart Portfolios’ Season 4 shared their expectations from the budget, the course they expect the markets to take and the stocks that interest them.
For the week, Rikesh Parikh’s net worth stands at Rs 1,022,000, up 2.18 per cent; Ashish Mittal’s net worth is at Rs 1,044,000, up 4.38 per cent; Alex Mathews’ net worth is at Rs 1,052,000, up 5.18 per cent; and Ajay Parmar’s net worth totals Rs 1,111,000, up 11.13 per cent.
RIKESH PARIKH, VP Equity Strategies, Motilal Oswal Securities
“Markets have built in some optimism prior to the Budget. However, further course of markets will be decided based on the final outcome, “said Parikh.
He expects to see some positive developments among the financials, utilities and the infrastructure stocks, post the budget. As of now, he is holding on to his current positions and will take a fresh look at his portfolio once the announcements have been made.
ASHISH MITTAL, Fund Manager- PMS, Centrum Wealth
“The political risk has already evaporated. The concern for the market, now, is whether unfolding of the Budget would derail the rally seen in the equity markets. According to me, the budget will be conducive for the stock market,” commented Mittal.
Mittal expects firm commitment on Foreign Direct Investment (FDI) into multi-brand retail and aviation, divestment of midcap PSUs and further relaxation for investments in debt instruments by the Foreign Institutional Investors (FIIs). He expects these measures to provide significant boost to the equity markets.
He also expects major boost to the infra sector in terms of significant concessions for investments by individuals, corporate and FIIs and also complete removal of import duty on fuels like coal and gas.“I firmly expect the stock market to go up significantly post-budget due to anticipated boost to the capex plan of industrial sector, major concessions for both retail and foreign investors, and firm commitments on major economic reform measures,” surmised Mittal.
ALEX MATHEWS, Head (Technical and Derivatives Research), Geojit BNP Paribas Financial Services Ltd
In Mathews’ opinion, the Union budget could be a balanced one, favoring the aam aadmi. “The Auto sector may get negatively affected if the excise duty on diesel engines is raised. Apart from that, the power sector may get some booster and agriculture, infrastructure and education could be the priority sectors,” he expressed.
Mathews is concentrating on the IT space at the moment as the growth picture in the United States as well as Europe is taking shape. He said, “Recent comments from Federal Reserve Chairman that the US economy is showing growth and the labor market is growing, are acting as positives.” Further, Indian IT major Infosys's CEO’s comments, regarding a good and strong order pipeline, have led Mathews to hold Infosys in his portfolio.
“I continue to give importance to the infrastructure sector and am holding Reliance Industrial Infra and HDIL,” he added.
AJAY PARMAR, Co-Head Investment Banking, Emkay Global
Commenting on his expectations from the budget Parmar expressed, “The UPA has no choice but to make it a popular budget by widening the service tax net, taking some concrete steps to spruce up investment in infrastructure and providing some concessions on the individual tax front.” The core issue to tackle, in his opinion, will be on the fiscal deficit side. “The classic way is to give some roadmap for the future (which normally are promises),” added Parmar.
Parmer expects the markets to react positively to anything that will solve the fiscal problem. “Otherwise, markets will fall from the current leek for a few days. All in all, according to me, budget will have a very limited impact on the markets,” he stated.
Parmar continues to focus on the banking, infrastructure, real estate, pharma and fertilizer stocks.He has taken up positions in banks like Axis bank and SBI and some agriculture stocks like Jain irrigation, Coromandel international and Chambal Fertilizer. He has also added infrastructure stocks like for GMR Infra and Jaiprakash Associates.