MARKET WRAP: Sensex gains 213 points post populist budget proposals

Among sectors, the Nifty Auto index was the top gainer of the day, rising 2.71 per cent led by Hero MotoCorp and Maruti Suzuki. The Nifty IT index too rose 1.45 per cent led by HCL Technologies

4:04 PM

COMMENT Jayant Manglik, President, Religare Broking

Nifty traded volatile in a broader range and settled with marginal gains. The tone was set from the beginning as participants were keenly awaiting the interim budget. It remained upbeat in the first half and retested its crucial hurdle at 10950 once again, but profit taking in the later half trimmed the gains. 

 

We might see overhang of the interim budget announcements early next week. Though the benchmark is somehow maintaining at higher levels but situation is bad on broader front. In present scenario, we advise focusing on stock selection and trade management. Investors, on the other hand, may use this phase to accumulate quality midcaps with long term view

4:03 PM

COMMENT Motilal Oswal, CMD, Motilal Oswal Financial Services

The budget is targeted toward providing benefits to farmers and the rural economy at large. Benefits to the middle class through tax sops are welcome efforts. Increasing Income Tax limits is a big reason to cheer for the salaried middle class. Extending benefit of section 54 to two houses’ rent benefits, increasing period up to 2 years for Capital Gains benefit on House will go well with the masses.

 

After initial euphoria markets will settle steady, this year being election budget will put around 40,000 crore in hands of masses that will be the reason for the corporate earnings to return in the 3rd quarter of the calendar year, we think these are very interesting times for a long term investor to build a position in equities

3:35 PM

Sectoral trends on NSE

3:34 PM

Top gainers and losers on S&P BSE Sensex

3:33 PM

EXPERT TAKE | Dr VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services

"Normally good politics becomes bad economics; and good economics becomes bad politics. This budget is a good example of a cocktail of clever politics and good economics. The two big bang announcements in the budget – relief to farmers and tax relief to the middle class – are people-friendly initiatives. The fact that the government has initiated these measures without sacrificing fiscal discipline makes the budget good economics. The FM is banking on good growth and tax buoyancy in FY 20. The revenue targets are a bit ambitious; but achievable with a nominal GDP growth of 11.5 % and tax buoyancy of 1.3%. But this requires a benign global economic environment. The slight rise in bond yields reflects the market’s concern regarding the revenue and deficit targets. 

 

The market's fear that the FM might become fiscally profligate to woo the voters has been unfounded. The tax relief to the middle class with high propensity to consume will certainly boost consumption, economic growth and corporate earnings. This augurs well for the markets."

3:33 PM

Market at close

The S&P BSE Sensex ended at 36,469, up 213 points, or 0.59 per cent, while the broader Nifty50 index settled at 10,894, up 63 points, or 0.58 per cent.

3:27 PM

Vedanta, Sterlite Technologies, Hindustan Zinc hit 52-week low

Shares of Anil Agarwal promoted companies – Vedanta, Sterlite Technologies and Hindustan Zinc, hit their respective 52-week lows, falling by up to 20 per cent on BSE in intra-day trade on Friday. READ MORE

 

3:11 PM

YES Bank falls 7% as senior group president Pralay Mondal resigns

Shares of YES Bank were down for the fifth straight day, down 7 per cent to Rs 182 apiece on BSE on Friday, after the private sector lender announced that Pralay Mondal has tendered his resignation as Senior Group President and Head - Retail & Business Banking of the bank on January 31, 2019. YES Bank was the top loser among Nifty Bank and Nifty Private Bank indices. READ MORE

 

2:56 PM

MARKET CHECK

2:42 PM

NEWS ALERT

SBI beat expectations and posted its highest quarterly profit in nearly seven years. Its net profit was Rs 3,955 cr rupees for the third quarter ended Dec. 31, versus a loss of Rs 2,416 cr rupees a year ago

2:33 PM

Shares of DHFL are trading over 22 per cent lower

2:29 PM

COMMENT G Pradeep kumar, CEO of Union Asset Management Company

This is a dream budget for the middle class and for farmers. With the increase in exempted income, increase in standard deduction, increase in limit for TDS etc. we can expect more disposable income in the hands of the people. The outlay for farmers should go a long way in reducing the stress in the agriculture sector. Mutual funds can also expect more inflows because the salaried class can use the extra disposable income for investments. Overall, the budget is very positive for the stock markets. 

2:26 PM

COMMENT Gaurav Gupta, CEO, Adani Capital on Interim Budget 2019

The Budget has announced some key measures for the rural economy and SME sector. The Interest subvention for SME for loans up to Rs. 1 crore, the government’s aim to source 25% from SMEs will spur a new wave of economic development, making way for more capital expenditure by the SMEs, with add-on benefits to other allied industries.  This will further aid employment generation and help in the all-inclusive growth of the economy.

2:24 PM

Amar Ambani, President & Head of Research, YES Securities on Interim Budget 2019

“If Math adds up, i.e. they can generate revenue to fund, then this is a positive budget.

 

1.Structural Consumption boost.

2. Govt borrowing under control.

 

As expected, farmers, middle-class and small businessmen (MSME) got huge support. Even outside the budget, lifting of PCA norms from 3 PSU banks is excellent news for improved credit access. Market also rejoicing cause the fear of over- populism impacting the fiscal math has not materialised."

2:19 PM

COMMENT B. Gopkumar, ED & CEO, Reliance Securities

It has been a very well balanced election budget. It has met the multiple objectives of stoking consumption, reducing farmer distress, reducing tax burden for middle class while managing the fiscal deficit under control. Fiscal deficit target of 3.4% for FY19 as well as FY20 is very much acceptable to the market. With this budget, growth is likely to improve further and meeting 7.5% real GDP growth for FY20 seems much more likely now

2:17 PM

COMMENT Paresh Parekh, Partner, Leader Consumer & Retail Tax, EY

Three key buckets of changes proposed (1) higher personal disposable income due to higher tax rebate for up to 5 lacs (2) higher rural disposable income because of farmers package, interest subventions etc (3) real estate and  housing sector proposals like no notional tax on second home, capital gains tax exemption for 2 homes and no notional tax for unsold real estate inventories up to 2 years - all these three buckets of changes are potential game changers for entire economy and Consumer sector in particular

2:01 PM

MARKET COMMENT Jagannadham Thunuguntla, Sr. VP and Head of Research (Wealth), Centrum Broking

Interim Budget-2019 has proved to be Godly Budget for Indian Middle Class. This section has got more than they had even anticipated with block-buster tax reduction announcements. This can trigger consumption wave with increased demand for automobile, FMCG, housing and building materials. It’s a great effort from Finance Minister balancing prudence and populism.

 

Similarly, the farm income scheme should help agri-associated businesses seeing renewed enthusiasm and revive rural demand. Government factoring-in higher than anticipated borrowing figure during FY20 can make bond markets somewhat anxious. However, if RBI can surprise the markets with dovish tone in the upcoming RBI monetary policy, this can also be expected to be resolved

1:58 PM

COMMENT Anuj Puri, Chairman – ANAROCK Property Consultants on realty sector sops

All in all, this was a balanced budget for real estate, even though it was clearly configured as a crowd-pleasing electoral pitch with a cursory nod towards the ongoing challenges in the economy. 

 

For the housing sector to regain significant momentum, the real need is to woo back the long-term investors who exited the residential market. One possible way was to re-introduce the home loan benefit on second homes. The Government's move on this front is certainly welcome. 

 

In mature markets, long-term investors keep the equity flow intact, and Indian real estate needs to have equity inflow rather than relying on debt. Equity can come through long-term investors and private equity or institutional players. 

 

Definitely, no single Union Budget has ever actually come to the rescue of the real estate industry. Any incumbent Government perpetually walks a perpetual tightrope stretched between the expectations of various industries and compelling economic prerogatives. Also, there are always areas for which there are no quick fixes possible at all

1:57 PM

COMMENT Ajay Bodke, CEO Prabhudas Lilladher PMS on Interim Budget 2019

A bold and path breaking Budget delivered by the Modi government in its final year of the first term. Government has eschewed populist impulses in an election year & has admirably arrested the slippage in fiscal deficit to just 3.4% of GDP for FY19. 

 

The Budget provides a massive boost to the primary engine of growth i.e. domestic consumption through income tax sops for nearly 30 million low-income taxpayers and 120 million marginal farmers. This would go down in history as India's seminal march towards providing succor to the economically disadvantaged groups.

 

Equity markets would rejoice with the force multiplying boost provided to sectors in domestic consumption like automobiles, consumer staples & durables, real estate, building materials, home improvement and retail-focussed banks & financials etc.

1:54 PM

Interim Budget 2019: Gross borrowing pegged at Rs 7.1 trillion for 2019-20

The gross borrowing for fiscal 2019-20 is pegged at Rs 7.1 trillion, and net borrowing at Rs 4.73 trillion against Rs 3.82 trillion last year, according to the Budget documents.

 

Last year, the gross borrowing was at Rs 5.45 trillion, revised down from the original Rs 6.05 trillion as the government had toned down its borrowing programme. The gross borrowing this time is higher because of higher redemption. READ MORE

1:38 PM

INTERIM BUDGET 2019 IMPACT: Auto, realty shares rally on sops to tax payers

Shares of auto and real estate companies rallied by up to 6 per cent on the bourses after the Finance Minister Piyush Goyal on Friday proposed measures to boost spending in infrastructure sectors and rural areas. READ MORE

 

1:37 PM

EXPERT TAKE | Vinod Nair, Head of Research, Geojit Financial Services

"The interim budget was watched by the market on few important points like SOPs to small farmers, Incentive to the common man and in the overall will it be fiscal prudent. The outcome have been marginally better than expected by the market since it provides a good package considering the upcoming general election, while maintaining a rationality in the long-term. For the market it will provide a good signal in the short-term since the interim budget will not trouble the economic accountancy and populist agenda.

1:23 PM

Dr Reddy's Labs hits 52-week high ahead of Q3 earnings

Shares of Dr Reddy’s Laboratories hit a 52-week high of Rs 2,760 apiece, up 1.3 per cent on BSE in the intra-day trade on Friday, ahead of December quarter results (Q3FY19) today. The drug company surpassed its previous high of Rs 2,745 recorded on December 3, 2018 in the intra-day deal.
 

Since October 26, post September quarter (Q2FY19) results, Dr Reddy’s has outperformed the market by 14 per cent, as compared to a 9 per cent rise in the S&P BSE Sensex. READ MORE

12:53 PM

Deven Choksey on Capital Gain Exemption

Capital Gain Exemption under 54 EA of 2 crore (one time) - for buying 2nd house should boost demand for housing sector and housing finance cos: Deven Choksey of K R Choksey

 

12:49 PM

Mark Mobius on fiscal deficit

3.4% fiscal deficit is not bad, but one needs to watch how the currency plays out: MARK MOBIUS

Mark Mobius

12:46 PM

NEWS ALERT

FM Piyush Goyal ends Budget speech

12:43 PM

BUDGET IMPACT :: Realty stocks in focus post focus on affordable housing, tax breaks

COMPANY NAME	LATEST	HIGH	LOW	CHG (Rs)	CHG(%)	VALUE (Rs CR)	VOLUME
UNITECH	1.57	1.58	1.51	-0.01	-0.63	0.13	858774
H D I L	26.80	27.10	26.20	0.45	1.71	0.77	285813
NBCC	59.20	60.00	58.50	0.45	0.77	1.65	278357
INDBULL.REALEST.	75.10	75.60	72.20	1.60	2.18	2.02	268630
DLF	168.20	171.00	163.70	3.55	2.16	4.23	251696

12:42 PM

EXPERT TAKE

"Government aims to completely digitalise income-tax return verification and scrutiny over the next 2 years, phasing out human intervention. Anonymous scrutiny assessments using a back office, if implemented well, would go a long way in improving the image of the Indian revenue system across tax payers. This coupled with the promised non-adversarial tax regime, would also enhance overseas investor confidence in the Indian tax system," says Jiger Saiya, Partner/ Tax & Regulatory Services, BDO India. 

12:38 PM

FM on TDS

No TDS on house rent of up to Rs 2.4 lakh/year

12:38 PM

FM on Standard deduction

Standard deduction for salaried raised from Rs 40,000 to Rs 50,000