Summary of the Day's Market Performance

• Nifty and Sensex recovered after diving sharply during the FM’s speech to end flat.

• Midcaps declined by -0.6%, and Smallcaps dropped by -0.9%.

"Nifty and Sensex recovered after diving sharply during the FM’s speech to end flat. However, Midcaps (-0.6%) and Smallcaps (-0.9%) weren’t that lucky."

• Top Performer: FMCG (+2.8%).

• Minor Gains: Auto (+0.3%).

• Underperformers: Real Estate (-2.3%), PSU Banks (-1.4%), Metals (-0.9%).

"Most sectors ended in the red. FMCG (+2.8%) was the top gainer, while Auto (+0.3%) saw minor gains. Meanwhile, Real Estate (-2.3%), PSU Banks (-1.4%), and Metals (-0.9%) took a beating."

Budget 2024-2025 Key Highlights

• Economic Outlook: India's growth is strong despite global uncertainties; core inflation is at 3.1%.

• Agriculture: Focus on climate-resilient crops, natural farming, and self-sufficiency in pulses and oilseeds.

• Employment & Skilling: Incentives for job creation, higher women workforce participation, and a skilling program for 20 lakh youth.

• Social Justice: Comprehensive schemes for social justice, tribal development, and women-led initiatives.

• MSMEs: Special packages, credit support, and new e-commerce export hubs for MSMEs and artisans.

• Infrastructure: Major projects in eastern states, including expressways, power plants, and financial support for Andhra Pradesh’s capital development.

• Financial Allocations: Significant funds for agriculture, education, rural development, and women-focused schemes.

The budget aims for inclusive growth, focusing on agriculture, employment, social justice, MSMEs, and infrastructure development.

Taxation Highlights

1. Income Tax Slabs and Rates (New Tax Regime)

   • Up to ₹3,00,000: Nil

   • ₹3,00,001 to ₹7,00,000: 5%

   • ₹7,00,001 to ₹10,00,000: 10%

   • ₹10,00,001 to ₹12,00,000: 15%

   • ₹12,00,001 to ₹15,00,000: 20%

   • Above ₹15,00,000: 30%

2. Standard Deductions

   • Increased for salaried individuals and pensioners from ₹50,000 to ₹75,000.

   • Family pension deduction was raised from ₹15,000 to ₹25,000.

3. Corporate Tax Rate for Foreign Companies

   • Reduced from 40% to 35% to attract foreign capital.

4. Simplification of Capital Gains Taxation

   • Short-term gains on certain financial assets are taxed at 20%.

   • Long-term gains on all assets are taxed at 12.5%.

   • Increased exemption limit for capital gains on certain financial assets to ₹1.25 lakh per year.

   • Long-term classification: Listed financial assets held for more than a year; unlisted financial and non-financial assets held for at least two years.

5. Digitalization and Taxpayer Services

   • Major services under GST, Customs, and Income Tax are digitalized.

   • The remaining services to be paperless in two years.

6. Charitable Trusts and TDS

   • Two tax exemption regimes for charities merged into one.

   • TDS rate on many payments was reduced from 5% to 2%; 20% TDS on mutual fund repurchases was withdrawn.

   • TDS on e-commerce operators reduced from 1% to 0.1%.

7. Reassessment Simplification

   • Reassessment can be done beyond three years only if the income is ₹50 lakh or more, up to five years.

   • The search case’s time limit was reduced to six years from ten years.

8. Tax Incentives for Investment and Employment

   • Abolished "angel tax" for all investor classes.

   • Simplified tax regime for foreign shipping companies operating domestic cruises.

   • Safe harbor rates for foreign mining companies selling raw diamonds.

   • Reduction of corporate tax rate on foreign companies from 40% to 35%.

9. Miscellaneous

   • Presumptive taxation regime for cruise ship operations by non-residents.

   • Introduction of block assessment scheme for search and seizure cases with a block period of six previous years taxed at 60%.

Market Transactions:

• 📉FII Sold: -2,975.31 cr.

• 📈DII Bought: 1,418.82 cr.

Key Stock Movements and News

• Top Gainers: Titan Company, Tata Consumer, ITC, NTPC, Adani Ports.

• Top Losers: L&T, ONGC, Hindalco, Shriram Finance, Bajaj Finance.

• Hindustan Unilever: Shares traded higher ahead of Q1 earnings.

• Moody’s: Continues to see GDP growth at 6.6% in FY25.

• Real Estate Stocks: Declined as Budget 2024 removes indexation benefit on long-term capital gains tax; DLF down 6%.

• SpiceJet: Board approved to raise Rs 3000 crore.

• Automobile Stocks: Tata Motors, M&M, and Maruti shares declined as Budget 2024 skips EV, hybrid emphasis.

• Travel Stocks: Rose on measures to boost domestic tourism; Yatra Online, Easy Trip Planners, EIH, Thomas Cook, Praveg gained up to 4%.

• Jewellery Stocks: Shined while MCX gold sank as FM Sitharaman slashed customs duty on gold in Budget 2024.

• Federal Bank: (+3%) was in focus after appointing KVS Manian as its new CEO.

• MapMyIndia: (+9%) and Genesys International: (+10%) surged after the FM announced that land records would be digitized with the help of GIS mapping.

• Dixon Technologies: Fell -4% after the GOI announced that it would cut import duties on mobile phones.

Stocks Worth to Watch

🧐 Wait……..

Summary and Outlook

"In summary, the Indian markets experienced volatility during the FM’s speech but managed to end flat. While FMCG and certain travel and jewelry stocks gained, real estate and automobile stocks saw significant declines. Investors will continue to closely monitor the impact of Budget 2024 on various sectors."

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Disclaimer: The information provided in this newsletter is for informational purposes only and should not be considered financial advice.

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