The Union Budget 2024-25 is expected to unveil significant announcements across various sectors, potentially impacting related stocks. Below, we highlight key areas of focus, anticipated government measures, and stocks that could benefit.
Agriculture
The agriculture sector faces challenges, including higher food inflation. The government is expected to allocate approximately ₹2 lakh crore, with emphasis on expanding income support and insurance schemes, possibly increasing the Minimum Support Price (MSP) for major crops. Strengthening the PM Kisan Samman Nidhi Yojna is also anticipated, enhancing farmer welfare.
Stocks to Watch:
Escorts Kubota: Increased farmer income could boost demand for farm machinery.
Kaveri Seeds: Enhanced support for farmers may drive sales of agricultural inputs like seeds.
Finolex Industries: As a leader in PVC pipes, the company could benefit from rural infrastructure development.
Mahindra and Mahindra (M&M): Dominating the tractor segment, M&M may see a rise in sales with improved farmer incomes.
Rural Consumption
Investment in digital infrastructure, job creation, and MSME development is likely to boost rural consumption. Anticipated increases in allocations to PM-KISAN, rural roads under PMGSY, and rural employment under MGNREGS could enhance disposable incomes.
Stocks to Watch:
Dabur India: Strong rural presence could benefit from increased rural spending.
Hindustan Unilever: With a focus on premiumization, the company might gain from enhanced consumer purchasing power.
Shakti Pumps: Leader in energy-efficient pumps, benefiting from the PM-KUSUM scheme.
TVS Motors: Strong rural sales base could benefit from improved rural incomes and government support for battery production.
Renewable Energy
The budget may increase investments in renewable energy, focusing on clean technologies and expanding solar and wind power projects. Additional funds for R&D in storage solutions and support for rooftop solar installations are also anticipated.
Stocks to Watch:
Tata Power: Could benefit from ISTS tax waivers and increased capex for renewables.
NTPC: Growth in demand and support for both thermal and green energy projects could be favorable.
Inox Wind: Potential boost from increased focus on wind power development.
Employment
The budget may introduce measures to support job creation, including an Employment-Linked Incentive (ELI) scheme for labor-intensive sectors like textiles, apparel, and tourism.
Stocks to Watch:
Arvind Limited: Potentially benefits from the ELI scheme, enhancing the textile and apparel sector.
KPR Mills: Expected to gain from cost reductions and increased incentives under the ELI scheme.
Affordable Housing
Expected continued funding for affordable housing and the development of new satellite townships could drive demand in the housing sector. The revamped PMAY-G scheme may increase cash support per housing unit.
Stocks to Watch:
Aavas Financiers: Benefits from housing loans in underserved areas.
Home First Finance: Could gain from reintroduction of the Credit Linked Subsidy Scheme (CLSS).
Aptus Value Housing: Focus on affordable housing for low- to middle-income families could see increased demand.
UltraTech Cement: Anticipated increases in housing and infrastructure spending may boost cement demand.
Railways
The budget is likely to emphasize infrastructure spending, particularly in railways, focusing on safety, travel quality, and infrastructure improvements.
Stocks to Watch:
IRCTC: Increased budget allocations could boost revenue from e-ticketing and catering services.
Container Corporation of India (CONCOR): Investments in logistics infrastructure could enhance operations.
Titagarh Wagons: Increased demand for railcars and related equipment expected.
Texmaco Rail: Likely to benefit from railway infrastructure projects.
These insights are speculative and depend on the actual budget announcements. Investors should conduct thorough research or consult financial advisors before making investment decisions.
Launch your Graphy