Budget 2024: Maruti Suzuki India Ltd was the biggest gainer among Nifty-50 stocks on Thursday as it gained over 4%, on the day on finance minister. Nirmala Sitharaman presented the interim budget. Power Grid, Cipla Ltd, SBI Life and Eicher Motors were the other prominent gainers with gains of 2-3% on the budget day.
For Maruti Suzuki during a strong increase in revenues reported by the company during the December quarter, despite weak demand also led to the gains. Analysts at Jefferies also indicated that valuations of Maruti share price trades at are positive. According to Jefferies Maruti traded at a valuation of 22 times FY25 estimate price to earnings compared to the last 10-year average of 24 times. Analysts said the budget indicating maintenance of a strong domestic also bodes well for Maruti’s sales. Further the budget’s emphasis on supporting Electric Vehicle production. Maruti plans to launch 10 new models by 2030 across ICEs and EVs
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Meanwhile Eicher Motors reporting a 31% year-on-year increase in motorcycle models with engine capacity exceeding 350cc also impressed.
Cipla remains a key beneficiary of increasing growth in the US business as domestic growth remains strong. Power grid will benefit from strong power demand. Rising energy infrastructure as a focus was highlighted in interim Budget also bodes well. The Government has a special focus on the energy segment.
Meanwhile Grasim Industries, Larsen & Toubro Ltd, UltraTech Cement, Dr Reddy’s Laboratories were among the biggest losers in the nifty 50 stocks, seeing their share prices fall over 2%.
Sentiments on infrastructure stocks remained mixed. Although the finance minister increased spending on the infrastructure sector by 11.1% to ₹11.11 Lakh crore, analysts say expectations were building for a higher increase and hence there was some disappointment. Not surprisingly L&T, the infrastructure majors and Cements manufacturers like Grasim, and UltraTech and even JSW steel with share price declining 1.9% year on year were among the top 5 losers.
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For L&T the weak margin profile reported by the company over the last few quarters has also dampened investor sentiments although growing order inflows bode well for future outlook.
Meanwhile for steel and Cement, the growing demand however remains positive for the outlook.
Aditya Jajodia, Chairman and Managing Director of Jai Balaji Industries, said the focus on housing outreach, along with the PM Jal Jeevan Mission, provides an important avenue for steel products.
The continued expansion of rural housing along with the proposal to develop three economic rail corridors under the PM Gati Shakti Yojana are other significant moves that will stimulate steel demand, create jobs and improve connectivity and logistics, said TV Narendran CEO & MD Tata Steel.
Disclaimer: The opinions and recommendations made above are those of individual analysts or trading companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions
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Published: 01 Feb 2024, 18:12 IST
(tagsTo Translate)Budget 2024