BUDGET DAY....ENJOY THE VOLATILITY...!!!!

The Disappointment continues in Dalal Street but BUDGET may bring some cheer, as well the challenging days are ahead for the retail investors who trapped at the 7800 level. The markets are always not courteous to traders who plunge to grab the” ticking-opportunity” for INSTANT GAINS.

The strength of the markets will not fissile unless decisively NIFTY breaks the earlier BEST SUPPORT levels at 7280 range. The fall in Banks are not due to VOLUME based selling but heavy UN-winding of positions. The banks will be under pressure so long SBI trades below 2680 and ICICI trades below 1448-52 level. The B-Nifty may drift lower but will bounce to new highs soon…….Now, the BUDGET DAY naturally carries HUGE volatility but the POSITIONS will be AFRESH OPENED.

PM-MODI & FM- ARUN JAITLY will focus on curbing INFLATION and Fiscal Prudence but the Govt spending will be increased with INCOME from ASSET SALE. The FDI in high speed trains, FDI in Defence Sector allowed and FDI/FII limits in insurance sector will be raised. The favourite areas will be HOUSING for POOR and UNIVERSITIES, HEALTH CARE along with  revival of economic activity through factories.

There will a decent amount set for women empowerment and security. The focus will be on EDUCATION sector and Renewable Energy will get decent boost. The very good news will be thrown opened to Sugar Industry, ETHNOL mixing by 20% in petrol.

The excise duty reduction on CEMENT and customs reduction newsprint imports and tax concession will be offered to LOWER INCOME Group/BUDGET HOUSES up to 25 lakhs, also the income tax exemption upto Rs 1.5-2lakhs. The IT exemption upto 3 lakhs will be on the cards.

The LUXURY cars/SUVs will be TAXED more and whereas TAX reduction for 100-125 cc motor cycles and scooters. The be leagued TELECOM sector will get decent boost by allowing FOREIGN GEAR BOX imports at less customs duty.  The BSNL&MTNL merger or listing of BSNL after budgeted support, OPTICAL FIBRE companies will get boost for early RURAL Connectivity for High speed internet and e-Governance plans.

The DISINVESTMENT in ONGC, COIL India and other companies in metal space will get special boost/benefits for SWEETENING the DEAL. To discourage the use Alcoholic drinks, increase of tax, but I doubt ITC will be spared by not increasing taxes on Cigarettes.

The PRIORITY will be given to AGRICULTURE, the COLD STORAGE and other Mandi facilities will be increased.  The GAS allocation to fertiliser units will be provided. 

The Road and PORTS will be given priority by PPP model and FDI in FAST TRACK TRAINS, duty-reduction to that extent is possible. Special focus will be laid down for UMPP projects get good benefits for increased POWER Generation, import of coal will be liberalised, customs duty will be reduced. The POWER and INFRA companies will be benefitted the most.

The petro product/gas company like reliance may not be favoured but it will get boost/support for its TELECOM& RETAIL Space.

The Aviation sector will get good support by reduction in excise duty on FUEL and they will be allowed to buy at Dollar price. Most likely the STT will be exempted, Dividend tax will be reduced , encouraging equity culture by allowing PF money invested through ETFs and the 2% surcharge will be discontinued and ceiling at 35% will be enforced.

OVERALL, the BUDGET may get thumping  boost to revive the economy.