Union Budget 2020: Here are sector-wise highlights of Union Budget presented by Finance Minister Nirmala Sitharaman
Presenting the Union Budget for 2020-21, Finance Minister Nirmala Sitharaman said, In May 2019, Prime Minister Narendra Modi received a massive mandate to form the government again. People of India have unequivocally given their janaadesh for not just political stability, but have also reposed their faith in our economic policy. This is a budget to boost their income and enhance their purchasing power.
Here are the highlights of this years budget:
|0 - 5 lakh
||0% (No tax Exemption)
|5 - 7.5 lakh
|| Reduced to 10% from the current 20%
|7.5 - 10 lakh
|| Reduced to 15% from the current 20%
|10 - 12.5 lakh
||Reduced to 20% from the current 30%
|12.5 - 15 lakh
|| Reduced to 25% from the current 30%
|Above 15 lakh
|| Continue at 30%, but without exemptions
Over 70 deductions have been removed.
Companies will no longer be required to pay Dividend Distribution Tax (DDT).
Aadhaar-based verification for GST compliance to be introduced.
Here is a short list of winners and losers sectors from Saturday budget announcements.
Sitharaman unveiled plans for Indias highways and railways, proposing Rs 1.7 trillion ($23.7 billion) for transport infrastructure that includes the accelerated development of highways and plans to monetize 12 lots of highway bundles.
Key infrastructure players like Larson and Toubro and KNR Constructions and IRB Infra look set to benefit.
The government plan to encourage the manufacture of mobile phones, electronic equipment, and semiconductor manufacturing as well as medical devices will be positive for companies such as Dixon Technologies, Amber Enterprises, Subros, said Vinay Pandit, Head of Institutional Equities at IndiaNivesh.
The farm and rural sectors were allocated Rs 2.83 trillion, while the agriculture credit target for next year is set at Rs 15 trillion.
News of the government proposal to expand fisheries and create 500 fish farmer producer organizations saw gains in Avanti Feeds, Apex Frozen Foods and Waterbase.
The minister announced that the rail service will be equipped with air conditioned freight cars and the government will provide viability gap funding for warehousing. Container Corporation of India Ltd is set to be the biggest winner off the move.
The Fast Moving Consumer Goods Index rallied, while Emami, Hindustan Unilever, Dabur, Tata Global are set to rally further.
Sitharaman announced measures to help farm sector growth in water-stressed districts, helping to boost the shares of VA Tech Wabag Ltd, which designs and builds water and sewage treatment plants.
Shakti Pumps India Ltd jumped the most in three-weeks on proposals to help farmers set-up standalone solar pumps to allow them to make a living out of their barren land.
The plan to provide piped water across Indian households by 2024 - with Rs 3.6 trillion in funding -- means Jain Irrigation Systems Ltd, KSB Ltd, Kirloskar Brothers Ltd., JK Agri Genetics Ltd., PI Industries Ltd. could benefit.
The minister also announced Rs 123 billion for the Clean India mission. Companies including Hindustan Unilever, ITC, Procter and Gamble, Godrej stand to gain here.
The government is also further developing Bharat Net -- or Bharat Broadband Network Ltd. -- a program to bring broadband to villages. The government plans to provide Rs 60 billion for the project in the next fiscal year.
Reliance Industries and HFCL Ltd. stand to benefit.
Education received significant attention in Sitharamans budget speech, with the sector receiving Rs 993 billion in 2020-21.
The establishment of degree-level, fully-fledged online education programs to be offered by institutions that are ranked within the nation top 100 will see online educators like National Institute of Information Technology and MT Educare benefit.
The announcement of a policy to allow the private sector to build data center parks has the potential to benefit all IT firms, including TCS, , Infosys, Wipro, HCL Technologies, Tech Mahindra, along with mid-sized firms like LTI, Mindtree, Persistent and Hexaware.
Adani Enterprises also stands to benefit from this development.
Pipeline&City Gas Suppliers :
India plans to expand its national gas grid to 27,000 kilometers from 16,200 kilometers.
Pipeline suppliers such as Welspun Corp., Maharashtra Seamless Ltd., Ratnamani Metals&Tubes Ltd., Jindal Saw, and Man Industries India Ltd. stand to benefit. Expanding the national gas grid is also positive for positive for companies such as IGL, MGL, and Gujarat Gas.
The government plan to sell a part stake in Life Insurance Corp. triggered declines in shares of private insurers, which were star performers in 2019. SBI Life Insurance Co. fell, as did HDFC Life Insurance Co. and Nippon Life India Asset Management Ltd.
The finance minister stayed silent on infusing new capital into state-run banks for 2020-21. If the government does not inject fresh capital, it would be the first under Modis five years in power.