Budget 2022 Focus on top Stocks and Sectors

On February 1, Finance Minister Nirmala Sitharaman will introduce the Union Budget 2022. The Budget is likely to have a supporting and enabling role in the ongoing third wave of the pandemic.

Last year, the majority of Dalal Street’s sectors managed to provide investors with a respectable quantity of solid returns. Experts are positive on specific industries and equities that are projected to prosper in the future, ahead of the Union Budget 2022.

Infrastructure is anticipated to get the greatest attention in the Budget, with the Finance Minister hinting at a focus on it. The corporate sector is doing well because of cheap lending rates, low tax burdens, and PLI programmes, but the rural and MSME sectors are struggling, so the government may focus its efforts there.

Furthermore, since it is an election year in UP and Punjab, the government may grant agriculture sector incentives. The hotel and transportation businesses, which have been heavily damaged by the virus, will also get assistance. Renewable energy and electric cars can qualify for tax breaks.

The pandemic has a negative influence on global economies, according to experts. The first wave, then the second, and finally Omicron. A good Budget is projected, with an emphasis on industry, infrastructure, hotels, and healthcare, while the nation battles with Omicron.

Experts said that private investment and consumption continue to be a source of concern. Following the lead of last year’s Budget, which concentrated mostly on healthcare and the rural economy, this year’s Budget will need a similar concentration. While the urban economy has managed to stay afloat, the rural economy is struggling, and that may be the FM’s emphasis, they added.

Experts went on to say that renewable energy and electric vehicles may be another area of concentration. In Glasgow, the Prime Minister declared a goal of net-zero carbon emissions by 2070. It’s possible that some announcements may be made regarding this.

They also said that since the hotel industry has been the worst impacted by the epidemic in the previous two years, any good statements promoting tourism, financial support, and/or tax benefits would be a huge boost. Because of valuations, experts are optimistic about the hotel business. Because of low occupancies, many excellent brands are selling at a significant discount to their values.

India’s GDP can continue to grow at a higher pace with the help of MSME. China has been working on this for two decades and is now the world’s largest producer. Despite the fact that the government has previously taken a number of efforts to boost local manufacturing, including tax breaks for importing equipment, larger credit lines, and sector-specific adjustments,

According to experts, we should temper our expectations for the next year. This year, the administration has a more difficult task: boosting the economy while keeping inflation under control. In the banking, infrastructure, health-care, real estate, and agricultural sectors, we expect some nice surprises in the Budget, which will boost the auto industry indirectly.

Many of the government’s themes will centre on how to resurrect the economy via productive expenditure and subsidies. As a consequence, we anticipate that the banking, automobile, infrastructure, fertiliser, and sugar industries will get increased attention in the Union Budget. In terms of top stock selections, experts believe Exide Industries, SBI, Deepak Fertiliser, Tata Power and Balrampur Chini would do well in the future.

Sectors such as sugar, fertilisers, real estate, capital goods, infrastructure, and renewable energy are in focus, as seen by the advance-decline ratios of the indices, with small-caps leading the way. The next Budget is likely to place a strong emphasis on capital spending. Experts best stock choices include Bharat Dynamics, Praj Industries, ELGI Equipments, Varroc Engineering and Anant Raj. Infrastructure, renewable energy, and electric vehicles are also hot topics for experts.

Source: Business Today

Disclaimer: This blog is exclusively for educational purposes and does not provide any advice/tips on investment or recommend buying and selling any stock.