Budget 2023: Here's What Stock Market Investors Expect From This Year's Union Budget

Union Budget 2023: The stock market investors are expecting a uniform tax structure for capital gains which might help taxpayers to have more disposable income from this year's Budget.

Budget 2023: Here's What Stock Market Investors Expect From This Year's Union Budget
Budget 2023: Stock market investors expect a balanced Budget this year. (ANI image used for representation)

WITH just a few days left for the Union Budget 2023, the whole country is eagerly waiting for February 1, when the Union Finance Minister Nirmala Sitharaman will present it. The PM Modi government’s last Union Budget before the 2024 Lok Sabha Elections could come as a major relief for investors as they are expecting a balanced Budget this year. 

Along with India's different sectors or industries which are expecting relief from this year's Budget, stock market investors are also anticipating a balanced Budget that focuses on job creation, greater spending on infrastructure, reigning in the deficit, and bringing the economy back on track.

Meanwhile, the BSE's benchmark Sensex has been nearly flat so far this month, as stock markets have been muted in the lead-up to the Union Budget. Even the corporate earning season failed to excite the markets, while some indices like IT and banks have seen some positive movements.

Key Demands Of Investors:

Narendra Solanki, Head- Equity Research Anand Rathi Shares & Stock Brokers, as quoted by news agency PTI, said that investors are expected to remain focused on three key factors from the pre-election year Budget 2023, firstly equity investors are expecting a uniform tax structure for capital gains which might help taxpayers to have more disposable income.

Secondly, investors will be looking for fiscal consolidation which is necessary for financial stability in the economy and thirdly, investors are contemplating policy reforms to rationalise bottlenecks for growth such as subsidies, a clear roadmap for disinvestment targets and expediting the much-awaited PSU privatisation or consolidation, he added.

"The impact of the upcoming Budget would depend on the actual budget proposal and markets will be keenly watching the fiscal deficit for FY24. A figure above 6 per cent will disappoint the market. But, this is unlikely," VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, quoted by PTI, said.

Sumit Chanda, Founder and CEO, JARVIS Invest, said, "Any changes to the tax slab of the salaried class or any incentive to the corporates for capex or reduced taxes will be viewed positively and one can expect the markets to rally post the Budget."

In addition to that, Kamlesh Shah, President, ANMI, said to push private and government spending, disinvestment, expanding the PLI (Product-linked incentive) scheme and relief in tax slabs are some of the measures that may have a positive impact on the market.

Geojit's Vijayakumar believes that the impact of the Budget will be short-lived. Market trends would be dictated more by developments in the global economy, particularly in the US. If the Fed commentary after the February 1 meeting is dovish and data shows inflation declining in the US, markets will rally.

Amar Ambani, Head – Institutional Equities, Yes Securities, said the government is likely to be modest in its asset monetization targets, unlike the lofty projections of the prior Budgets. In all probability, India's GDP growth target would be a low double-digit affair amid a challenging global backdrop, and the government would not stray from its fiscal prudence roadmap.

According to market experts, healthcare, fertilizer, infrastructure, defence insurance, manufacturing, digitalisation (IT), communication, education, Small and Medium Enterprises (SMEs) etc are sectors that are expected to benefit from the Budget.


(With Agency Inputs)

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