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Budget 2020: What can cheer share market?

Budget boosterShutterstock.com
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Budget booster
There is a need to drive consumption for sustained growth of the economy. Therefore, the demand side needs a booster from the Budget in the form of more disposable income in the hands of consumers. Economists are hoping for a possible tweak in income-tax slabs. For financial markets to get more vibrancy, some easing of the long-term capital gains tax, relief from dividend distribution tax (DDT), an increase in the government’s capital expenditure and further impetus to the real estate sector are what investors and analysts have been hoping for.

Below are the key things, which if they materialize, can give a boost to the share market:
A tweak in income-tax slabs/ratesShutterstock.com
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A tweak in income-tax slabs/rates
There are hopes that the government would reduce personal income-tax rates either by way of rationalising tax slabs or raising exemption limits. Should that materialise, it would benefit consumer discretionary and urban plays. CLSA said shares of the companies like Maruti, Titan, Asian Paints, United Spirits, Jubilant and Havells could be top gainers with any income-tax cut.
Rollback of long-term capital gains taxShutterstock.com
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Rollback of long-term capital gains tax
There has been a demand for rollback of the long-term capital gains (LTCG) tax. The last financial year saw the re-introduction of this levy on equities. Now, any realised gain from equities over and above Rs 1 lakh in a financial year is taxable at 10 per cent. The government is also expected to tweak sector-specific import duties for promoting domestic manufacturing. These steps, if announced, are bound to cheer investors.
Booster dose for BharatShutterstock.com
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Booster dose for Bharat
Antique Stock Broking is hoping for a push to rural demand by increasing allocations to various rural centric schemes. The government may announce fresh policy measures to achieve its target of doubling farmer income by 2022. Such a move will be positive for consumption and agriculture-related stocks such as M&M, Escorts, Hero, TVS, Bajaj Auto, HUL, Colgate, Dabur, Emami, Jyothy Lab, Bajaj Electrical, Crompton Consumer, Dhanuka Agrotech.
Housing booster as growth multiplierShutterstock.com
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Housing booster as growth multiplier
Analysts expect an expansion of the definition of affordable housing either by raising carpet area and ticket price. There may be an announcement related to an increase in tax benefits on home loans. Any step to boost the real estate and ancillary sectors will be positive for sectors like cement, building materials and consumer electricals or consumer durables.
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