Sectors and Stocks in focus on Budget proposals

Stocks you need to keep a tab on for today following the announcements

ITC is likely to remain in focus after Union health minister Harsh Vardhan urged Finance Minister Arun Jaitley to raise tax on cigarettes in the upcoming final Union Budget for 2014-15 to deter people from smoking.

 

Sesa Sterlite is likely to gain as Iron Ore Exports have shown a whopping 40.5% decline in the first quarter ended June 30 this year at 1.93 million tonnes (mt). During the corresponding quarter last year, exports stood at 3.26 mt. The decline is largely attributed to global slowdown in spot market prices and better prices in the domestic market owing to ban in Odisha, which led to hike in prices. 

 

Addressing problems of infrastructure sector is the key focus of the government in the Budget. Hence capital goods such as L&T and BHEL are likely to gain. 

 

There is deep financial stress in the Banking system with developers balance sheet being stretched, inability to raise debt, and large projects becoming potential NPAs. Therefore, some stringent measures are expected in favour of the Banking space in this Budget.  In addition, PSU Banks remain in focus as capital infusion is proposed in this Budget. 

 

Oil and Gas stocks are likely to remain in focus as inclusion of crude oil, natural gas and other petroleum products in the goods and services tax regime is expected. In addition, Import duty exemption on LNG to all sectors, exemption of excise duty for compression of natural gas into CNG for use in natural gas vehicles and continued diesel deregulation are also expected in the forthcoming Budget.