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What is in store for Nifty after the Budget?

Good Morning Everyone, The budget for the year was presented yesterday. It was a pretty balanced budget, though the markets were not very excited about it, even staying without fall is positive in the market. Look at the huge volatility in the nifty yesterday.

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Global Markets:

Wall Street closed higher Tuesday, getting February off to a decent start on the heels of a miserable January. S&P 500 rose 0.7 percent, Dow Jones rose 0.8 percent, and the tech-heavy Nasdaq rose 0.7 percent.

Euro zone manufacturing activity accelerated last month as supply chain bottlenecks eased, although the improvement was not evenly spread across member countries and factories still faced high inflationary pressures, a survey showed on Tuesday.

IHS Markit's final manufacturing Purchasing Managers' Index (PMI) rose to a five-month high of 58.7 in January from December's 58.0, below an initial "flash" estimate of 59 but comfortably above the 50 mark separating growth from contraction.

Asian shares rose higher this morning, tracking stocks on Wall Street. MSCI's broadest index of Asia-Pacific shares ex-Japan surged 0.3 percent. Shares in Japan advanced 1.5 percent. Markets in China, Hong Kong, Singapore, South Korea are closed today for Lunar New Year holiday. Elsewhere in Australia, stocks jumped 1.9 percent.

Oil prices closed flat Tuesday, as geopolitical tensions and tight global supplies supported the market even as some speculated the oil cartel OPEC+ might boost supplies in the coming meeting. On Wednesday, Brent crude was up 0.3 percent at $89.45 and the US oil was rising to $88.45.

Indian Market:

Trends on the SGX Nifty indicate a gap-up opening in Nifty today.

Rupee slipped 17 paise to close at 74.82, paring initial gains, as caution set in among market participants after the govt raised the fiscal deficit target above than that of FY22 in the Budget. Meanwhile, the dollar index fell 0.19 percent to 96.35 Monday.

Chief Economic Advisor V Anantha Nageswaran believes that India can become a $5 trillion economy by the FY 2025-26 or 2026-27.

Addressing the press conference that was held after Finance Minister Nirmala Sitharaman tabled the Union Budget 2022-2023, the CEA said that if the GDP continues to grow at 8 percent, a $5-trillion economy for India is possible.

"If we continue to retain the path of 8 percent of real GDP growth, it will translate into even 8 percent dollar GDP growth. If we extrapolate it, we should be a $5-trillion economy in terms of nominal GDP in the financial year 2025-26 or the financial year 2026-27," he said.

The telecom minister Ashwani Vaishnaw on Tuesday said that the Telecom Regulatory Authority of India's (TRAI) recommendation on the 5G spectrum is expected to come by March, after which spectrum auction will be held expeditiously for the rollout of the next-generation service.

The minister said the Department of Telecom is parallelly working on other auction-related processes to start the spectrum auction at the earliest. Commenting on the Union Budget 2022-23, the minister said "recommendations on 5G are expected by March".

The Union Budget lacks any tangible measures to increase revenue generation even though the capital expenditure plans have gone up significantly and the fiscal deficit estimate suggests that the government is relying too much on strong growth to help drive fiscal consolidation, rating agency Moody's said in a note.

The Budget underscores the government's previous emphasis on capex to sustain near-term recovery from the pandemic, while simultaneously paving the way for longer-term restructuring of the economy, it said.

Here are some excerpts from the Budget 2022

Borrowing plans: India plans to sell a record amount of bonds—worth Rs 15 trillion—in FY23. As per budget documents, net borrowings for the coming fiscal are estimated at Rs 11.2 trillion.

Fiscal deficit: Govt has pegged the fiscal deficit for 2021-22 at 6.9 percent of GDP and at 6.4 percent for 2022-23. The deficit for FY22 is 10 basis points higher than the earlier projection of 6.8 percent.

GDP estimate: India’s GDP is pegged at 9.2 percent for FY22, highest amongst all the large economies, FM Sitharaman said Tuesday.

Capex: FM announced a sharp rise in capex by 35.4 percent to Rs 7.50 lakh crore for FY23. In FY22, capex was Rs 5.54 lakh crore.

Crypto gains tax: FM Sitharaman announced a 30 percent tax on crypto gains, along with a TDS of 1 percent on transfer of digital assets. She said the loss from transfer of digital assets cannot be set off against any other income.

Results today

HDFC, Adani Green Energy, Dabur India, Aarti Surfactants, Apollo Tyres, Adani Total Gas, Bajaj Consumer Care, Balaji Amines, Balrampur Chini Mills, Blue Star, eClerx Services, Gillette India, Indian Overseas Bank, JK Lakshmi Cement, Jubilant FoodWorks, Mahindra & Mahindra Financial Services, Meghmani Organics, Sandhar Technologies, Shankara Building Products, Suryoday Small Finance Bank, Tata Consumer Products, Timken India, VRL Logistics, Windlas Biotech, Zee Entertainment Enterprises, and Zydus Wellness.

FII and DII data

Foreign institutional investors (FIIs) net sold shares worth Rs 21.79 crore, while domestic institutional investors (DIIs) net bought shares worth Rs 1,597.70 crore in the Indian equity market on February 1

Stock Specific News:

Tech Mahindra | The company reported a higher consolidated profit at Rs 1,378.2 crore in Q3FY22 against Rs 1,340.9 crore in Q2FY22, revenue rose to Rs 11,450.8 crore from Rs 10,881.3 crore QoQ.

Adani Ports and Special Economic Zone | The company on Tuesday reported a net profit of Rs 1,472.3 crore for the quarter ended December 2021, down 5.7 percent on a year-on-year basis.

Indian Hotels | The company reported its quarterly net profit at Rs. 76.01 crore in December 2021, up 163.94% from Rs. 118.88 crore in December 2020.

Supriya Lifescience | The company's officials will interact with analysts and investors today.

Windlas Biotech | The company concluded SAHPRA (South African Health Products Regulatory Authority) inspection audit report for the Plant-IV situated at Dehradun with zero critical observations/ deficiencies, zero major deficiencies and some minor deficiencies.

MMTC | The government approved Tata Steel Long Products as a strategic buyer for the privatisation of Neelachal Ispat Nigam, a joint venture of four CPSEs (MMTC, NMDC, BHEL, MECON) and two Odisha government PSUs (OMC and IPICOL).

VIP Industries | The company reported consolidated profit at Rs 33.47 crore in Q3FY22 against a loss of Rs 7 crore in Q3FY21, revenue rose to Rs 397.34 crore from Rs 232.53 crore YoY.

Laxmi Organic Industries | The company reported a higher consolidated profit at Rs 82.09 crore in Q3FY22 against Rs 45.21 crore in Q3FY21, revenue jumped to Rs 859.87 crore from Rs 435.5 crore YoY.

Anupam Rasayan | The company will acquire a 24.96 percent stake in Tanfac Industries Ltd (TIL) for Rs 148.14 crore from Birla Group Holdings and a few other promoter groups of TIL.

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