Barring Nifty Pharma, all the Nifty sectoral indices ended in the green led by Nifty Bank indexShare Market on Budget 2021 HIGHLIGHTS: Domestic equity market benchmarks BSE Sensex and Nifty 50 ended 5 per cent higher on Monday in post Budget rally. Sensex surged 2,315 points or 5 per cent to 48,600.61, while Nifty 50 ended at 14,281, up 646 points or 4.74 per cent. Top Sensex gainers were IndusInd Bank, ICICI Bank, Bajaj Finserv, State Bank of India (SBI), Larsen & Toubro, Housing Development Finance Corporation (HDFC), among others. On the flip side, Dr Reddy’s, Tech Mahindra and Hindustan Unilever Ltd (HUL) were the only Sensex laggards today. Barring Nifty Pharma, all the Nifty sectoral indices ended in the green led by Nifty Bank index, up 8.26 per cent, which hit record high intraday. In the broader market, BSE Midcap and Smallcap indices rose 2-3 per cent.
Highlights
Overall, this is a great budget in terms of defining the government’s intent and roadmap including the modifications to the FRBM, which I think was much needed, it was designed at a different time with a different objective. I would say that on a scale of 1 to 10, I would rank this budget at a 7.5, and now the real test would of course be its real implementation which can take it to a 10/10 if even 70% of what is stated gets implemented: Sanjay Kumar, CEO & MD, Elior India
Budget 2021 definitely has proposals that bring cheer to the D street but also have announced measures that are aimed to implement the Clean-up of the bad loans and asset monetisation in a well-coordinated way by announcing the setting up of an ARC to deal with the NPAS: Rajeshree Sabnavis, Founder, Rajeshree Sabnavis & Associates
Super positive session is witnessed on Indian bourses, both nifty and bank nifty has shown a strong move and closed a day with gains of 5 & 8 per cent respectively. Strong breakout is witnessed in the nifty bank even nifty has seen small falling trend line breakout, going forward immediate support is formed near 14200-14070 zone holding above said levels we may see pull back to continue and resistance is placed at 14400-14500 zone: Rohit Singre, Senior Technical Analyst at LKP Securities
Sensex closes up 2476 points or 5.35 per cent to 48,762, while the Nifty 50 ended at 14,331, up 696 points.
The FM has delivered a unique Budget, wherein all the right measures have been proposed to speed up growth. The move of rationalization of spends, minimal changes to the direct and indirect taxes and no additional taxes will be well received. Higher spending will kickstart a virtuous cycle of growth. The expansion in spending will be funded by higher borrowings which has the potential to create an upward pressure on inflation and interest rates a few months down the line. We believe that the RBI will be in sync with the Govt and both will take necessary action to prevent this happening.: Dhiraj Relli, MD & CEO, HDFC Securities
We decided to spend big on infrastructure in this Union Budget 2021, FM Sitharaman said.
The Union Budget 2021-22 has provisions to boost demand and supply of affordable housing. While extension of the deduction on payment of interest on purchase for affordable housing by another year will encourage home buyers to invest on their own properties, extension of the tax holiday on affordable housing projects will encourage more launches in this category: Ravindra Sudhalkar, CEO, Reliance Home Finance
BSE Sensex jumped 2,265 points or 4.89 per cent to 48,550, while the Nifty 50 was nearing the 14,300-mark. IndusInd Bank zoomed 15%, ICICI Bank 12.07% while Bajaj Finserv jumped over 11 per cent.
"The real estate industry was expecting growth measures from the Union Budget. Given the current situation, the Finance Minister has presented a balanced budget. The budget was primarily focused on the infra and healthcare sector. Steps like a 1-year tax holiday for affordable housing projects and a 1-year extension for an additional deduction of interest up to Rs 1.5 lakh on loan for affordable housing will benefit all stakeholders of the industry and boost investments. Relief on TDS for dividend on REITs and InvITs will boost investment in these instruments," said Krish Raveshia, CEO at Azlo Realty.
Domestic insurance companies can now have as high as 74% foreign direct investment (FDI), an increase from 49% earlier, Finance Minister Nirmala Sithraman announced in her budget speech. With this announcement, listed insurance sector players were seen zooming higher during the day. SBI Life Insurance jumped over 2% to reach a high of Rs 897 per share, HDFC Life Insurance was up nearly 2% at Rs 713 apiece, followed by ICICI Prudential Life. General Insurance Corporation saw the biggest surge, gaining 6% during the day.
Read full story
The market has given complete thumbs up to this mega event has recovered a fair bit of ground. Banking has been the major charioteer in this move. For Nifty, 14200 is the level to watch on a closing basis. If manages to surpass, we may see it heading higher. However, a close below 14000 will not bode well for the bulls.: Sameet Chavan (Chief Analyst-Technical and Derivatives, Angel Broking)
Indian share markets cheered the Union Budget 2021 announcements and zoomed over 4 per cent after the FM Nirmala Sitharaman concluded her Budget speech. BSE Sensex reclaimed its crucial 48,350-mark, while the broader Nifty 50 index crossed 14,200 level. According to the market watchers, the absence of any negative was the biggest positive for the D-Street. BSE Sensex hit an intraday high of 48,381.57, while Nifty 50 touched 14,214.80. Milan Vaishnav, CMT, MSTA, Consulting Technical Analyst and founder of Gemstone Equity Research & Advisory Services, told Financial Express Online that the FM Nirmala Sitharaman did not tamper with STT, or LTCG which could have otherwise spooked the markets.
Read full story
The budget called for increased government spending to revive the economy. There was an infrastructure push in the budget, focussing on development finance institution and asset monetization to fund the infra projects. Privatization of PSBs was another bold announcement. Positively, there wasn’t any increase in taxes, even when the fiscal deficit figures are projected at a higher range: Deepthi Mathew, Economist at Geojit Financial Services
This is indeed a bold growth-oriented budget. Absence of the much-feared Covid tax and the surcharges on Income Tax is a great relief. Privatization of 2 nationalised banks and proposal of monetization of assets like land are clear positives. Raising FDI in insurance from 49% to 74% is welcome. Market response to the budget reflects growth optimism. In brief, the FM has presented a pragmatic, bold and visionary budget in these difficult times: VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services
The fiscal deficit is pegged at 9.5% in FY2021 which is in-line with our predictions of 9.6% -10.3% made earlier in December. The high fiscal deficit was expected because of low growth leading to lower tax revenues and higher government spending to support lives and livelihoods. The deficit is likely to come down to 6.8% in FY2022 and below 4.5% in the years later, similar to our projections. The expenses will continue to remain high in FY2022 as infection reduces and vaccination exercise gains strength. A stronger and sustainable rebound in the second half of FY2022 will help the government to improve its fiscal and debt situation in the years ahead.: Rumki Majumdar, Economist, Deloitte India
With an aim to improve the funding for the country’s infrastructure sector, Finance Minister Nirmala Sitharaman today announced the setting up of a Development Finance Institution (DFI). “Infrastructure needs long-term debt financing. A professionally managed Development Financial Institution is necessary to act as a provider, enabler, and catalyst for infrastructure financing,” the Finance Minister said today in the Parliament. Additionally, the minister announced that Foreign Portfolio Investors (FPI) will now be enabled to debt finance REITs and INVITs after necessary amendments to the law.
Read full story
Markets surged as there was no announcement relating to COVID cess, no increase in LTCG or wealth tax. It's a very good Budget. Also, there was no negative news for taxpayers: Nirmal Jain, chairman and co founder at IIFL Securities, told CNBC TV 18
Primarily, the absence of any negative was the biggest positive. Taxes, both direct and Indirect, were left untouched. The FM has not tampered with STT, or LTCG which could have otherwise spooked the markets. Further, laying prominence of disinvestment, especially of LIC has gone right. Further, I also feel that the overall net-borrowing of government and the deficit figure is very much in control.: Milan Vaishnav, CMT, MSTA, is a Consulting Technical Analyst and founder of Gemstone Equity Research & Advisory Services
ICICI Bank, Housing Development Finance Corporation (HDFC), HDFC Bank, Reliance Industries Ltd (RIL) contributed the most to Sensex' 1,400 points up move.
Nifty 50 was ruling at 13,865.55, up 231 points or 1.69 per cent. While BSE Sensex zoomed over 1,150 points to 47,518.
An Institutional framework to buy investment grade corporate bonds along with new AMC to take up stressed debt from banks together would help in bringing in liquidity to debt markets and facilitate faster debt resolution for stressed asset: Suraj Malik, Partner - Transaction Tax, BDO India
No deduction on the employer on late deposit of employee's contribution to PF and other social security schemes. This had become a litigious issue and the announcement will help curb litigation and ensure timely deposit by employers: Sachin Garg, Partner, Nangia Andersen LLP
Electronic and mobile phone: Exemptions on parts of mobile phone chargers and some part of mobiles to be removed as part of Phased Manufacturing Program (PMP) to augment PLI Schemes: Nischal S Arora, Partner, Nangia & Co
Extension of start-up tax holiday and window for capital gains exemption for investment in start-ups till March next year, will boost the start-up ecosystem and further motivate investment by public- Sandeep Jhunjhunwala, Partner, Nangia Andersen LLP
Exemption on aircraft least income of non-residents makes a comeback after 13 years: Vishwas Panjiar, Partner, Nangia Andersen LLP
Tax holiday for aircraft leasing, relocation of foreign funds into IFSC will provide big boost to promote IFSC as alternate competitive global fund jurisdiction Sunil Gidwani Partner Nangia Andersen LLP
Extension of tax holiday for affordable housing projects till March next year, to provide a breather to existing projects and attract new participants to avail the benefits - Sandeep Jhunjhunwala, Partner, Nangia Andersen LLP
The need for infrastructure development has also been addressed and an outlay of 64,180 crore has been provided over 6 years. The substantial increase in investment would strengthen institutions and improve existing conditions for the better. This increased allocation and push from the government would enable India to emerge as a global leader on both R&D and infrastructure front.: Likhita Chepa, Senior Research Analyst at CapitalVia Global Research
The government on Monday budgeted Rs 1.75 lakh crore from stake sale in public sector companies and financial institutions, including 2 PSU banks and one insurance company, in the next fiscal year. Unveiling the PSE policy in Budget 2021-22, Finance Minister Nirmala Sitharaman said barring four strategic areas, public sector companies in other sectors will be divested. The policy would give a clear roadmap for disinvestment in strategic and non-strategic sectors. (PTI)
Exemption of Dividend income on REITs to encourage investors to explore this market and further boost investment in the real estate sector: Sandeep Jhunjhunwala, Partner, Nangia Andersen LLP
TDS on dividends for FPIs reduced to treaty rates as demanded by major industry bodies will provide much-needed relief for FPIs: Sunil Gidwani Partner Nangia Andersen LLP
After Covid-19, as expected, a substantial increase in healthcare sector expenditure amount in the budget is a welcome and much needed step. As usual, implementation of the plan will be most important. Much awaited increase of FDI to 74% in insurance sector will go a long way to increase insurance penetration in India. The changes proposed to decriminalise various violations under SEBI and Corporate laws will provide ease in operating business in India: Bhavik Narsana, Partner, Khaitan & Co
The single securities market code announced in the Budget speech will bring out ease of doing business in Indian financial markets. This along with FDI regime and Development financial institution would be transforming for financial markets: Lav Chaturvedi , ED & CEO, Reliance Securities
Significant increase in number of tax return filers is a good indicator of increasing the tax base in India: Shailesh Kumar, Partner, Nangia & Co LLP
Allotment of a massive capital expenditure corpus in order to enhance and support national highway projects, roads and other ancillary infrastructure shows the continued commitment of the Government to strengthen connectivity across the country which in turn will largely improve supply chain & logistics over the next few years.: Mihir Mehta, Senior Vice President, Ashika Capital
Consolidation of several securities laws into a single code will provide certainty and stability to deepen and strengthen Indian capital and debt markets: Suraj Malik, Partner - Transaction Tax, BDO India
To realise the potential of NIP, there is a need for our very own DFI that will address the issues of capital requirements in India. Infrastructure growth in India is longing for a mega DFI with a bigger risk appetite, that will provide the much needed long term financing to new as well as stalled projects with long gestation periods, and will ease out the burden of commercial banks.: Ajay Sawhney, Partner, Cyril Amarchand Mangaldas
Robust infrastructure assets will be key in realising India’s ‘Atmanirbhar’ ambition and scaling up our capability to make India an export hub, generate employment, beat repercussions of COVID-19, and assist to augment the demand side of the economy as well: Ajay Sawhney, Partner, Cyril Amarchand Mangaldas
A boost in infrastructure spending is a must to revive demand in the economy. Infrastructure development will catapult the country on a higher growth trajectory and have positive cascading effects on many other sectors. NIP (one of its kind initiative) needs to be given a strong push to provide world class infrastructure and improve quality of life.: Ajay Sawhney, Partner, Cyril Amarchand Mangaldas
Fine print of announcements relating to ARC and asset management company to acquire, manage and sell stressed and distressed loans to AIFs needs to be assessed. This could lead to spreading the risk and reward of such investments across wider spectrum of sophisticated who under the extant guidelines may not have qualified as QIBs for direct investment in security receipts such NRIs, family offices etc: Shagoofa Rashid Khan, Partner and Head - Project, Investment, and Advisory Cyril Amarchand Mangaldas