The FY 2026 Union Budget, set for February 1, 2025, is expected to benefit Real Estate, Cement, Railways, and Construction.
Budget 2025: The nation eagerly anticipates the Union Budget for FY 2026, to be presented by Union Finance Minister Nirmala Sitharaman on February 1, 2025, at 11:00 A.M. With recent domestic and macroeconomic trends in mind, investors are focusing on sectors likely to experience growth and become attractive investment opportunities based on the Finance Minister’s announcements.
Key Sectors and Stocks to Watch
1. Agriculture: India’s Backbone Industry
The farm sector seeks reforms to address weather challenges and improve financial security. Key expectations include easing loan repayments, enhancing the Kisan Credit Card scheme, and scrapping GST on agricultural inputs. Doubling PM Kisan Samman Nidhi support from ₹6,000 to ₹12,000 is also anticipated. Expanding MSP coverage beyond 22 crops is under discussion.
Stocks to Watch:
- UPL Limited
- Coromandel International
- Godrej Agrovet
2. Automobile: Accelerating Towards Sustainable Mobility
The automobile industry looks forward to reforms aimed at promoting growth and sustainability. Simplifying GST classification for vehicles and auto components will reduce compliance costs and enhance operational efficiency. A key expectation is reducing GST on hybrid vehicles, currently taxed at 28%, making them more affordable and bridging the gap between internal combustion engine (ICE) vehicles and electric vehicles (EVs).
Stocks to Watch:
- Tata Motors
- Mahindra & Mahindra
- Bajaj Auto
- TVS Motor Company
3. Real Estate: Building Dreams for Millions
Real estate expects key reforms in Budget 2025, including increasing the housing loan interest exemption from ₹2 lakh to ₹3 lakh. Granting industry status to developers and changing GST rules would reduce costs, making housing more affordable and stimulating demand.
Stocks to Watch:
- DLF Limited
- Godrej Properties
- Sobha Limited
4. Electronics: A Push for Domestic Production
The highly anticipated ₹25,000 crore Production-Linked Incentive (PLI) scheme is expected to revolutionize India’s electronics industry. The scheme aims to boost domestic manufacturing of electronic components like PCBs, batteries, displays, and camera modules. This initiative aligns with the ‘Make in India’ campaign and is projected to produce components worth $50-60 billion, positioning India as a leader in electronics manufacturing.
Stocks to Watch:
- Dixon Technologies
- Bharat Electronics Limited (BEL)
- Tata Elxsi
5. Pharmaceuticals: On the Road to Becoming a Global Pharma Hub
The pharmaceutical sector is hoping for the establishment of a single regulatory authority for pharmaceuticals and medical devices to simplify licensing and compliance processes. Financial incentives for R&D, along with an expedited patent filing system, are also expected. These changes could solidify India’s position as a global pharmaceutical hub.
Stocks to Watch:
- Sun Pharma
- Dr. Reddy’s Laboratories
- Cipla
- Lupin
6. Education: Preparing for a Better Tomorrow
The education sector seeks a funding increase to 6% of GDP, with a focus on digital education, AI, and machine learning. Support for STEM programs and teacher training is also a priority. Reducing GST on educational services and implementing NEP 2020 reforms aim to enhance accessibility and global competitiveness.
Stocks to Watch:
- Navneet Education
- Career Point
- NIIT Limited
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