Budget for Growth

Nifty50: 17,616 ▼ 45 (-0.2%)
Sensex: 59,708 ▲ 158 (+0.2%)

The FM proclaimed, “...Now I come to what everyone is waiting for..,” before introducing her tax proposals. And many would agree that this year, FM Nirmala Sitharaman delivered, though it came with a caveat. 

Like an app on your phone that reminds you to download its latest version, the government also wants you to migrate to the New Tax regime. Do that and you could benefit from a higher tax rebate or more rationalised tax slabs or lesser surcharge (if you are an HNI). (The old tax regime will still be valid this year, without the benefits) So, will you cross over to the other side? 

Meanwhile, markets today couldn’t make up their mind - swinging wildly up and down all through the trading day. Not just that, we also saw the Sensex close up and Nifty close down on what was a ‘hairy’ Wednesday. Read on to see why. 

Among the Nifty sectoral indices, IT (+1.1%) and PSU Bank (+0.5%) were the top gainers, while Oil & Gas (-3.5%) and FMCG (-0.6%) were the top losers.

What’s trending

Missed the Budget? Don’t worry. Here’s a TLDR:

⭐Simpler KYC, Investor friendly initiatives 

Finance Minister proposed to use PAN card as as a common identifier for all digital systems at government agencies. The move is expected to simplify the KYC process. Meanwhile for investors, announcements like integrated IT portal to access unclaimed investments, expanding scope of Digilocker and setting up a national financial information registry have been made. 

⭐ Big boost for Infra sector

Finance Minister announced a steep rise of 33% in capital investment to ₹10 lakh crore for the financial year 2023-24. The move could give a big boost to companies operating in the infrastructure segment, including cement and steel firms.

⭐ Railways get highest-ever allocation

Indian Railways received the highest-ever budgetary allocation of ₹2.4 lakh crore, an increase of over 65% compared to previous year. The funds will be spent on building railway tracks, wagons, trains, and electrification which could offer big tendering opportunities to companies.  

⭐ More money for affordable homes

Budget 2023 increased allocation under PM Awas Yojana by 66% to ₹79,000 crore, giving a further boost to the government’s programme to provide affordable housing for all. The move could support the realty sector and its aligned segment.

⭐ What’s expensive, what’s cheaper 

After Budget 2023, items like cigarettes, compounded rubber, gold bars and kitchen chimney are set to get costlier. However, TV, mobile phones and lab grown diamonds are expected to get cheaper.

TAXES: FM grants 5 wishes, with a pre-condition

The FM announced 5 big changes for taxpayers under the new income tax regime. Let’s take a look:

1) You might know that you are eligible for a tax rebate if your income after all deductions amounts to Rs 5 lakh per annum. This eligibility limit has been hiked to Rs 7 lakh per annum. But you can only avail this rebate if you have opted for the new tax regime.

2) The tax slabs under the new IT regime have been revised too. Here are the revised slabs:

3) Additionally, taxpayers and all pensioners under the new tax regime can now also avail the benefits of standard deduction. Under this, each salaried person with an income of Rs 15.5 lakh or more will thus stand to benefit by Rs.52,500.

4) The next change covers HNI taxpayers. The highest surcharge rate has been reduced from 37% to 25%. With this, the maximum income tax any individual would pay in India will be capped at 39%. Surcharge is an additional tax levied on tax and is applicable to those who have annual income over 50 lakh rupees.

5)  The new tax regime will become the default tax regime. Though the finance minister clarified the old tax regime will continue too.

So, that’s a host of changes on the tax front. But, do remember, this is only valid if you shift to the new tax regime. 

Sensex heads North, Nifty goes South

Nifty down, Sensex up !

The budget made domestic indices go wild today, to say the least. How often do you see Nifty and Sensex ending the day on different notes? Well, today was one of such bizarre days. Wondering why Nifty ended below the 18,000 mark while Sensex closed in green? Read on.

Adani stocks drag Nifty

As you know, Nifty50 comprises 50 stocks. Out of which, 2 stocks are of Adani Enterprises and Adani Ports. But in our vintage Sensex’s 30 stocks list, these 2 are not included. The weightage of these 2 stocks in Nifty50 is 0.6% and 0.5% respectively. Now, today Adani 

Enterprises saw a fall of 51% while Adani Ports was down 20%. Together, they contributed 71 points to Nifty’s fall.

Adani stocks resume slide 

After the Hindenburg research report came out, Adani group stocks have been seeing a sell-off spree. And today, investment banking company Credit Suisse stopped accepting bonds of the Adani Companies as collateral for margin loans.

This was the driving factor behind Nifty’s rough day. 

Budget Factoid

Budget 2023 wasn’t all serious business. There were some fun, lighthearted moments too. Like the time FM Nirmala Sitharaman made a slip-of-tongue while announcing a policy of removing old 'polluting' vehicles. The FM said old 'political' instead, as laughter erupted in the Parliament. The Minister quickly realised the ‘oops moment’ and said, “Sorry… I know,” while repeating the correct statement with a wide smile.

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