Union Budget 2022-23

01-02-2022
 Budget 2022 – Govt Thrusts Green Energy, Mobility
& Public Infrastructure

HISTORIC BUDGET TO HELP INDIA CHUG TOWARDS A $5TN ECONOMY AFTER A MOMENTARY PANDEMIC PAUSE. FM FOCUSES ON GROWTH!
Highlight
The FY23 budget has been quite a landmark budget in many senses. Given a backdrop of global pandemic having ravaged the economy for two full years (FY20-FY22
GDP is expected to be flat and FY20-FY23 is expected to grow at ~3% CAGR, which is a loss of 3% CAGR from its pre-pandemic path), Govt’s fiscal situation needed a
tight rope walk to please all stake-holders (rating agencies, investors and public at large). The govt, however, has chosen a bolder path, highlighting its resolve to give
growth the impetus by focusing on infrastructure and capex (expenditure target +35.4% YoY, to 7.5L crores). And while doing so the govt has also ensured that
the growth comes through the segments which also promotes energy sufficiency, climate empathy & compliance (EVs, Renewables and Digital Economy).
While the global outlook for 2022 will remain challenging from a liquidity PoV, govt’s impetus to growth will ensure significant opportunities for investors in such sectors.
A slight largesse on fiscal as govt chooses Investment Over Consumption
The govt has chosen to give thrust on investment over consumption by focusing on capex and investments rather than subsidies and tax cuts. Key areas that
encapsulates this thrust are PM Gati Shakti, Inclusive Development, Productivity Enhancement, Sunrise Opportunities, Energy Transition and Climate Action. In doing
so, the govt has pegged the FY23 BE Fiscal Deficit at 6.4% as against FY22 RE Fiscal Deficit of 6.9%. Market borrowing for FY23 is pegged at Rs.11.6 lakh crores
with divestment target for next fiscal expected at Rs.65k crores.
Sunrise Areas (Green Energy, Green Mobility & Sustainable Infrastructure) Receive Maximum Attention & Allocation
While the govt has focused on capex and investments in general, climate change support, electric mobility and infrastructure development has received the maximum
attention. The govt will bring in Battery Swapping Policy to allow EV charging stations for automobiles as a step towards that direction. Besides, private sector will be
encouraged to create sustainable and innovative business models for battery and energy as a service, improving the efficiency in the EV ecosystem. Additionally, 4 pilot
projects for coal gasification will be set up and Rs.19,500 crores additional allocation for PLI for manufacturing high efficiency solar modules has been
provided for. As far as infrastructure is concerned, govt has singular focus on “Gati Shakti plan” which is aimed at easing movement of people and goods. The FM in her
3
 Budget 2022 – Contd…

speech said the Indian road network will be increased by 25k kilometers in FY23, as part of this scheme. The government will also be adding 400 more Vande Bharat
trains. As part of the infra/Make In India push, the govt committed to reduce defence equipment imports, with 68% of defence capex being earmarked for domestic
companies in FY23.
No major tax changes
As far as taxation is concerned, there were no major surprises or changes. There were no significant changes on the personal tax front. However, the govt did
extend tax relief for select start-ups by 1 year and now startups formed till March 2023 can also benefit from govt’s tax sops. Moreover, income from any virtual digital
asset will now be taxed at 30%. As far as LTCG tax structure is concerned, the govt capped the surcharge on long-term capital gains on any asset class at 15%.
Operational ease was also part of govt’s thrust with a new provision to allow taxpayers to file an updated return being introduced. Updated return can now be filed within
2 years from the end of the relevant assessment year.
Conclusion
With nearly 10% loss of GDP (over FY20-23 period) from the pre-pandemic trajectory, the govt had a tough job to choose between rock (growth push) and a hard place
(fiscal prudence). One had to come at the expense of the other. The govt has chosen to side with growth for the moment with the hope that increased growth (with a
supply side focus and investment thrust) will make up for the fiscal generosity over the long term as nominal GDP will likely see multiplier benefits from infrastructure
and investment push. Tax compliance (which has been on the rise already) will also aid in fiscal consolidation over the long term. Also, the govt has also chosen to push
growth through sectors which will promote sustainable development, climate compliance and energy self-reliance. Govt’s fiscal math is fairly believable (budgeted
tax growth of 9.6%, market borrowing of 11.6L crores and divestment target of 65k crores) and the govt has opted for policy continuity and implementation rather
than “new announcements”. Given that 2022 is expected to be a turbulent (read: volatile) year for most asset classes with the US Federal Reserve (amongst other
central banks) likely to embark on a near unprecedented rate hiking cycle, the govt has covered most bases, by pushing growth without significantly crowding out private
investments and concurrently pushing the “Green, Clean & Sustainable Development” model of growth. It must also be added that with over 165 crore doses of
Covid vaccine having been administered, the govt has ensured that all segments of the economy can now open up and provide support to growth. Good times await!
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 Key Budget highlights

 India GDP growth is expected at 9.2% in FY22, on the back of a sharp rebound in the economy from pandemic lows . The virtuous cycle of investment is
expected to revive on account of capex (capital expenditure) push in the budget and without significantly crowding out private investment. GDP for BE 2022-2023
has been projected at Rs.258 lakh crore ($3.4tn) assuming 11.1% growth over the estimated GDP of Rs.232 lakh crore for 2021-2022 (RE).

 The government pegged the fiscal deficit for the FY23 at 6.4% of GDP, as the budget recognised the need to boost growth. The Budget has revised upwards the
fiscal deficit for FY22 to 6.9% from 6.8% as per FY22 BE.

 Receipt from disinvestment proceeds in next financial year (FY23E) are pegged at Rs.65k crore, lower than the current year's (FY22) revised estimate of Rs.78k
crore. Public issue of LIC expected shortly and is included in current year’s divestment proceeds.

 Infra & Capex Push : Total outlay for capital expenditure stood at Rs.7.5 lakh core for 2022-23 v/s Rs. 5.54 lakh crore BE and Rs.6.02 lakh crores RE last year.

 PM Gati Shakti will be driven by 7 engines - roads, railways, airports, ports, mass transport, waterways. logistics infra. Announced allocation of Rs.20k crore
through innovative ways towards PM GatiShakti Master Plan for Expressways wherein the National Highways will be expanded by 25,000 km.

 As a part of National Ropeways Development Programme : Parvatmala, contracts for 8 ropeway projects for a length of 60km will be awarded in 2022-23.
 Agriculture: Rs. 2.37 lakh crore towards direct payment of MSP to farmers for the procurement of wheat in Rabi season 2021-22 and estimated procurement of
paddy in Kharif season 2021-22 from 163 lakh farmers.

 MSMEs: Expanded Emergency Credit Line Guarantee Scheme (ECLGS) for MSMEs by Rs.50k crore to a total Rs.5 lakh crore and extended it up to March 2023.
Further, facilitated additional credit of Rs.2 lakh crore for Micro & Small Enterprises under Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE)
scheme.
 The Production-Linked Incentive (PLI) scheme across 14 sectors, which has the potential to generate at least 60 lakh (6 million) new job opportunities was
extended to solar panel manufacturing.
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 Key Budget highlights – cont’d

 Har Ghar, Nal Se Jal: Allocation of Rs.60k crore, will cover 3.8cr households with tap water by 2022-23.

 Hosing for All: Rs.48k crore allocated towards PM Awas Yojana for completing 80 lakhs houses in 2022-23.

 Telecom: Spectrum auctions for 5G technology will be conducted in 2022 to rollout of 5G mobile services within 2022-23.

 Solar Power: Allocation of Rs. 19.5k crore towards PLI for manufacturing of high efficiency solar modules to achieve the ambitious goal of 280 GW of installed
solar capacity by 2030.
 Data Centre and Energy Storage Systems including dense charging infrastructure and grid-scale battery systems will be included in the harmonized list of
infrastructure. This will facilitate credit availability for digital infrastructure and clean energy storage.

 Electric Vehicles - 1) Battery swapping policy to allow EV charging stations for automobiles will be framed; 2) Private sector will be encouraged to create
sustainable and innovative business models for battery and energy as a service.

 Defence – 1) Govt committed to reduce import and promote self-reliance in defence sector; 2) 68% of capital for defence sector to be earmarked for local industry
vs. 58% last fiscal; 3) 25% defence budget would focus on R&D; 4) Private sector will be encouraged to take up the design and development of military platforms
and equipment in collaboration with DRDO and other organizations through SPV model.

 Proposed to introduce Digital Rupee, using block chain and other technologies, to be issued by the Reserve Bank of India starting 2022-23.

 Proposed to set up 75 digital banking centres in 75 districts by commercial banks. In 2022, 100% of 1.5 lakh post offices will come on core banking system to
facilitate financial inclusion.

 To provide one-time window to correct omissions in ITRs filed, updated returns to be filed within 2 years.

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Tax Highlights
 Key Direct & Indirect Tax Changes

 No changes in Personal Income Tax and Corporate Tax Rates.

 For start-ups, tax incentive extended for 1 more year, i.e. start-ups established till FY23 to get tax incentive (zero income tax) for any three consecutive
years out of ten years from incorporation.
 A concessional income tax regime of 15% for newly incorporated domestic manufacturing companies extended by 1 year till 31st March, 2024.
 Minimum alternate tax (MAT) reduced for cooperative societies from 18% to 15%, which now brings it in-line with what companies pay. Surcharge on
co-operative societies reduced from 12% to 7% for those having total income of more than Rs1 cr and up to Rs 10 cr.
 Any income from transfer of any virtual digital asset to be taxed at the rate of 30%. Additionally, a 1% TDS will be charged on the transaction value.
 Long-term capital gains on listed equity shares, units etc. are liable to maximum surcharge of 15%, while other assets are subjected to a graded
surcharge upto 37%. This discrepancy has been rationalized and will be capped at 15% for all asset classes.
 Customs duty rates will be calibrated to provide a graded rate structure to facilitate domestic manufacturing of wearable devices, hearable devices and
electronic smart meters.
 Customs duty on cut and polished diamonds and gemstones to being reduced to 5%.
 To incentivise exports, exemptions wil be provided on items such as embellishment, trimming, fasteners, buttons, zipper, lining material, specified
leather, furniture fittings and packaging boxes that may be needed by bonafide exporters of handicrafts, textiles and leather garments, leather footwear
and other goods.
 Duty reduced on certain inputs required for shrimp aquaculture to promote its exports.
 To encourage the blending of fuel, unblended fuel shall attract an additional differential excise duty of Rs 2/ litre from 01/10/22.
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Fiscal Math
 Fiscal Math (Revenue + Capital Receipts)

% Of % Of % Of % Of % Δ (FY23BE Over
Particulars FY21 Actuals FY22 BE FY22 RE FY23 BE
Total Total Total Total FY22RE
Revenue Receipts (A) 1,633,920 41% 1,788,424 44% 2,078,936 49% 2,204,422 48% 6.0%
Tax Revenues (Net) 1,426,287 36% 1,545,396 38% 1,765,145 41% 1,934,771 42% 9.6%
Corporation Taxes 457,719 12% 547,000 14% 635,000 15% 720,000 16% 13.4%
Taxes On Income 470,391 12% 548,500 14% 595,000 14% 680,000 15% 14.3%
Taxes On Property & Capital Transactions 16,939 0% 12,500 0% 20,000 0% 20,000 0% 0.0%
Customs 134,750 3% 136,000 3% 189,000 4% 213,000 5% 12.7%
Excise 389,667 10% 335,000 8% 394,000 9% 335,000 7% -15.0%
GST 551,542 14% 633,327 16% 678,327 16% 783,706 17% 15.5%
Service Tax 1,615 0% 1,000 0% 1,000 0% 2,000 0% 100.0%
Taxes On Union Territories w/o State Legislature 2,572 0% 3,732 0% 3,732 0% 4,115 0% 10.2%
Less - State's Share -594,997 -16% -665,563 -18% -744,785 -19% -816,649 -19% 9.6%
Non Tax Revenues (Net) 207,633 5% 243,028 6% 313,791 7% 269,651 6% -14.1%
Fiscal Services 1,169 0% 702 0% 1,184 0% 1,296 0% 9.5%
Interest Receipts, Dividends & Profits 156,407 4% 154,024 4% 185,679 4% 148,801 3% -19.9%
Other Non Tax Revenue 273,079 7% 398,739 10% 394,080 9% 425,569 9% 8.0%
Grants In Aid & Contributions 1,752 0% 747 0% 1,345 0% 620 0% -53.9%
Revenue Expenditure (B) 3,083,519 82% 2,929,000 79% 3,167,289 79% 3,194,663 75% 0.9%
Revenue Deficit (A-B) 1,449,599 NA 1,140,576 NA 1,088,352 NA 990,241 NA -9.0%

Source: Indiabudget.gov.in, ABML Research, (In Rs crore)

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 Fiscal Math (Revenue + Capital Receipts) – Cont’d

% Of % Of % Of % Of % Δ (FY23BE Over
Particulars FY21 Actuals FY22 BE FY22 RE FY23 BE
Total Total Total Total FY22RE

GDP (Incl Adv Est & Budget Est) 19,764,033 NA 22,159,000 NA 23,059,261 NA 25,956,188 NA 12.6%

Revenue Deficit As % Of GDP 7.33% NA 5.15% NA 4.72% NA 3.82% NA NA

Capital Receipts (Excl Borrowings) (C) 67,820 2% 239,375 6% 110,600 3% 89,666 2% -18.9%

Recoveries Of Loans 29,923 1% 64,375 2% 32,600 1% 24,666 1% -24.3%

Other Capital Receipts (Incl Divestments) 37,897 1% 175,000 4% 78,000 2% 65,000 1% -16.7%

Effective Capital Expenditure (D) 657,182 17% 773,348 19% 840,396 20% 1,067,889 23% 27.1%

Total Receipts (Excl Borrowings) (A+C) 1,701,740 43% 2,027,799 50% 2,189,536 51% 2,294,088 50% 4.8%

Total Expenditure (Excl Borrowings) (B+D) 3,972,034 100% 4,019,760 100% 4,283,089 100% 4,576,180 100% 6.8%

Fiscal Deficit 1,818,291 46% 1,506,812 37% 1,591,089 37% 1,661,196 36% 4.4%

Fiscal Deficit As % Of GDP 9.2% NA 6.8% NA 6.9% NA 6.4% NA NA

Source: Indiabudget.gov.in, ABML Research, (In Rs crore)

11
 Expenditure Of Major Item’s

Particulars 2020-2021 Actuals 2021-2022 BE 2021-2022 RE 2022-2023 BE

Expenditure Item Amt % Amt % Amt % Amt %

Interest 679,869 19.4% 809,701 23.2% 813,791 21.6% 940,651 23.8%

Defence 340,094 9.7% 347,088 10.0% 368,418 9.8% 385,370 9.8%

Subsidy 707,707 20.2% 336,439 9.7% 433,108 11.5% 317,866 8.1%

Fertiliser 127,922 3.6% 79,530 2.3% 140,122 3.7% 105,222 2.7%

Food 541,330 15.4% 242,836 7.0% 286,469 7.6% 206,831 5.2%

Petroleum 38,455 1.1% 14,073 0.4% 6,517 0.2% 5,813 0.1%

Pension 208,473 5.9% 189,328 5.4% 198,962 5.3% 207,132 5.3%

Transfer to States 211,475 6.0% 293,302 8.4% 285,394 7.6% 334,339 8.5%

Rural Development 214,246 6.1% 194,633 5.6% 206,948 5.5% 206,293 5.2%

Transport 216,795 6.2% 233,083 6.7% 325,443 8.6% 351,851 8.9%

Commerce and Industry 21,554 0.6% 34,623 1.0% 45,833 1.2% 53,116 1.3%

Development of North East 1,854 0.1% 2,658 0.1% 2,658 0.1% 2,800 0.1%

Education 84,219 2.4% 93,224 2.7% 88,002 2.3% 104,278 2.6%

Energy 32,728 0.9% 41,747 1.2% 48,684 1.3% 49,220 1.2%

Health 80,026 2.3% 74,602 2.1% 85,915 2.3% 86,606 2.2%

IT and Telecom 32,778 0.9% 53,108 1.5% 28,757 0.8% 79,887 2.0%
Source: Indiabudget.gov.in, ABML Research, (In Rs crore)

12
 Expenditure Of Major Item’s – Cont’d

Particulars 2020-2021 Actuals 2021-2022 BE 2021-2022 RE 2022-2023 BE

Expenditure Item Amt % Amt % Amt % Amt %

Rural Development 214,246 6.1% 194,633 5.6% 206,948 5.5% 206,293 5.2%

Scientific Departments 22,100 0.6% 30,640 0.9% 28,510 0.8% 30,571 0.8%

Social Welfare 37,563 1.1% 48,460 1.4% 44,952 1.2% 51,780 1.3%

Urban Development 46,701 1.3% 54,581 1.6% 73,850 2.0% 76,549 1.9%

Union Territories 47,605 1.4% 53,026 1.5% 57,533 1.5% 58,757 1.5%

Home Affairs 96,652 2.8% 113,521 3.3% 115,550 3.1% 127,020 3.2%

External Affairs 14,329 0.4% 18,155 0.5% 16,000 0.4% 17,250 0.4%

Finance 37,038 1.1% 91,916 2.6% 51,904 1.4% 21,354 0.5%

Planning and Statistics 3,172 0.1% 2,472 0.1% 4,808 0.1% 5,720 0.1%

Tax Administration 146,439 4.2% 131,100 3.8% 195,351 5.2% 171,677 4.4%

Others 91,998 2.6% 87,528 2.5% 101,864 2.7% 113,301 2.9%

Source: Indiabudget.gov.in, ABML Research, (In Rs crore)

13
 Deficit Funding

Particulars 2020-2021 Actuals 2021-2022 BE 2021-2022 RE 2022-2023 BE

Receipt Type Amt % Amt % Amt % Amt %

Market Borrowings (G-Secs + Tbills) 1,239,737 68% 967,708 64% 875,771 55% 1,158,719 70%

Securities Against Small Savings 483,733 27% 391,927 26% 591,524 37% 425,449 26%

State Provident Funds 18,514 1% 20,000 1% 20,000 1% 20,000 1%

Other Receipts (Internal Debt and Public Account) 13,315 1% 54,280 4% -90140* NA 37,025 2%

External Debt 70,181 4% 1,514 0% 19,746 1% 19,251 1%

Draw Down of Cash Balance -7,188 0% 71,383 5% 174,187 11% 752 0%

Total Fiscal Deficit 1,818,291 100% 1,506,812 100% 1,591,089 100% 1,661,196 100%

Source: Indiabudget.gov.in, ABML Research, (In Rs crore)

14
 Major Scheme Allocation

2020-2021 2021-2022 2021-2022 2022-2023 % Increase (FY23-

Scheme
Actuals BE RE BE FY22)

Mahatma Gandhi National Rural Employment Guarantee Program 111,170 73,000 98,000 73,000 -26%

National Social Assistance Program 42,443 9,200 8,730 9,652 11%

Pradhan Mantri Jan Aarogya Yojna (RSBY) 2,681 6,401 7,500 7,857 5%

Blue Revolution 709 1,015 1,210 1,891 56%

Border Area Development Programme 64 566 222 566 155%

Green Revolution 9,748 13,408 8,889 0 -100%

Jal Jeevan Mission (JJM)/National Rural Drinking Water Mission 10,998 50,011 45,011 60,000 33%

Jobs and Skill Development 3,682 3,482 2,753 2,688 -2%

Modernisation of Police Force 2,057 2,803 3,346 2,754 -18%

National Education Mission 28,088 34,300 30,796 39,553 28%

National Health Mission 37,478 37,130 34,947 37,800 8%

National Livelihood Mission – Ajeevika 10,025 14,473 12,505 14,236 14%

Pradhan Mantri Awas Yojna (PMAY) 40,260 27,500 47,390 48,000 1%

Pradhan Mantri Gram Sadak Yojna 13,688 15,000 14,000 19,000 36%

Source: Indiabudget.gov.in, ABML Research, (In Rs crore)

15
 Major Scheme Allocation – Cont’d

2020-2021 2021-2022 2021-2022 2022-2023 % Increase (FY23-

Scheme
Actuals BE RE BE FY22)

Pradhan Mantri Krishi Sinchai Yojna 7,877 11,588 12,706 12,954 2%

Shyama Prasad Mukherjee Rurban Mission 369 600 375 550 47%
Swachh Bharat Mission 995 2,300 2,000 2,300 15%
Swachh Bharat Mission (Gramin) 4,945 9,994 6,000 7,192 20%
Urban Rejuvenation Mission: AMRUT and Smart Cities Mission 9,754 13,750 13,900 14,100 1%
Pradhan Mantri Ayushman Bharat Health Infrastructure Mission (PMABHIM) 0 0 585 4,177 614%
Prime Minister Formalisation of Micro Food Processing Enterprises Scheme(PM-FME) 395 500 399 900 126%
Pradhan Mantri Kisan Samman Nidhi (PM-Kisan) 60,990 65,000 67,500 68,000 1%
Crop Insurance Scheme 14,161 16,000 15,989 15,500 -3%

Urea Subsidy 90,549 58,768 75,930 63,222 -17%

Nutrient Based Subsidy 37,372 20,762 64,192 42,000 -35%

Production Linked Incentive Schemes 0 0 182 1,629 795%
Regional Connectivity Scheme 700 600 994 601 -40%

Food Subsidy to Food Corporation of India under National Food Security Act 462,789 202,616 210,929 145,920 -31%

National Investment and Infrastructure Fund (NIIF) 3,570 5,003 5,002 5,003 0%

Pradhan Mantri Kisan Sampada Yojana 667 700 791 900 14%

Source: Indiabudget.gov.in, ABML Research, (In Rs crore)

16
 Major Scheme Allocation – Cont’d

2020-2021 2021-2022 2021-2022 2022-2023 % Increase (FY23-

Scheme
Actuals BE RE BE FY22)
Pradhan Mantri Swasthya Suraksha Yojana 6,840 7,000 7,400 10,000 35%
FAME Scheme (Electric Vehicles) 318 757 800 2,908 264%
Metro Projects 8,573 18,998 18,978 19,130 1%
Direct Benefit Transfer – LPG 23,667 12,480 3,400 4,000 18%
NHAI 46,062 57,350 65,060 134,015 106%

Source: Indiabudget.gov.in, ABML Research, (In Rs crore)

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ABML Top Budget Picks

Aavas Bajaj Borosil Dalmia ICICI Infosys

Financiers Finance Renewables Bharat BANK
CMP ₹ 3114 CMP ₹ 7015 CMP ₹ 651 CMP ₹ 1903 CMP ₹ 810 CMP ₹1772

Minda Polycab Reliance Tata Tata

L&T Industries Chemicals Power
Industries India
CMP ₹ 1991 CMP ₹ 1991 CMP ₹2539 CMP₹2379 CMP ₹953 CMP ₹250

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 ABML Top Budget Picks

PAT P/E
Company CMP Remarks
FY22E FY23E FY22E FY23E
Government allocated Rs 48,000 cr (Rs 40,500 cr in PY) for affordable housing. Focus on rural growth through highway
AAVAS FINANCIERS LTD 3114 330 449 70.3 53.1 development, tap water access, etc to support rural housing growth. Aavas has growth capital with tier 1 ratio of 50%+
and is major beneficiary in this segment.

Increased capital expenditure to support economic and industry credit growth. Bajaj Finance with strong Tier 1 capital of
BAJAJ FINANCE LTD 7015 7,059 10,583 60.1 39.9 24%+ to benefit from the same. Further, government's measures for SME, housing and rural segment to support the
company's AUM, NII and PAT growth trajectory.

BRL is in into solar glass (a part of solar module) with market share of ~50%. The Budget made an additional allocation
BOROSIL RENEWABLES LTD 651 135 200 62.9 42.4 of Rs 19,500 crore for solar module under PLI schemes. Its capacity is likely to double in Q1FY23 and 4x in next 3 years
and earnings are likely to see sharp growth ahead.

Higher allocation to highways, affordable housing and PM Gati Shakti Plan augurs well for cement demand. Dalmia is
DALMIA BHARAT LTD 1903 859 1,218 41.6 29.1
among the leading cement player with reasonable valuation.

Increased capital expenditure to support economic and credit growth. ICICI Bank has traditionally been a strong
ICICI BANK LTD 810 22,563 27,874 24.8 20.3 corporate lender and is the major beneficiary of the same. The bank has strong growth capital and deposit base to
benefit from the same.

The pandemic has increased client spend on digital investments & cloud transformations; this spend is expected to
INFOSYS LTD 1772 22,542 26,622 33.2 27.9
remain buoyant as clients continue to invest to ensure resilience in infrastructure during uncertain times.

Source: Indiabudget.gov.in, ABML Research, (In Rs crore)

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 ABML Top Budget Picks

PAT P/E
Company CMP Remarks
FY22E FY23E FY22E FY23E
The Budget 2022 laid emphasis on Infrastructure segment, higher capital expenditure (35.4% YoY to Rs 7.50 lakh crore)
LARSEN & TOUBRO LTD 1991 9,454 12,208 29.5 22.6
and Gati Shakti programme (driven by 7 engine) and is big positive for LT.

MIL is aggressively looking at EV space, where its content/vehicle is ~3x of ICE 2Ws, bringing in significant growth
MINDA INDUSTRIES LTD 1114 368 625 84.6 50.2 opportunity. The budget focused on battery swapping policy and is encouraging private players for battery and energy as
a service and would benefit Minda.

Higher Allocation to infra sector as a whole will led to increased demand for wires and cables. Polycab is the largest
POLYCAB INDIA LTD 2539 829 1,099 45.9 34.1
manufacturer and should stand to benefit.

Reliance is poised for strong growth across its main verticals of Telecom, Retail, O2C & New Energy. The new energy
RELIANCE INDUSTRIES LTD 2379 58,940 73,548 27.1 21.2 vertical will see investments of Rs. 75,000cr in setting up 4 giga factories across solar, energy storage and green
hydrogen which will place the company on a new growth trajectory.

Demand-Supply mismatch to ensure higher realisations for soda ash. Demand to remain higher from glass & EV battery
TATA CHEMICALS LTD 953 986 1,257 24.6 19.3
applications. Fresh capacity addition globally over next 2-3 years to be negligible.

With the government intent on improving the health of discoms, Tata Power's return ratios would improve going ahead.
TATA POWER CO LTD 250 2,220 2,495 37.1 32.9
Additionally, the company would be a key beneficiary of the government’s thrust on solar energy and EVs.

Source: Indiabudget.gov.in, ABML Research, (In Rs crore)

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Research Team
Vivek Mahajan
Head of Research
022-6819 0549
vivek.mahajan@adityabirlacapital.com

Fundamental Team
Vidrum Mehta Auto / Capital Goods 022-6819 0537 vidrum.Mehta@adityabirlacapital.com
Jaymin Trivedi Banking & Finance 022-6819 0511 jaymin.trivedi@adityabirlacapital.com
Naveen Baid IT / M&E / Healthcare / Telecom 022-6819 0516 naveen.baid@adityabirlacapital.com
Sumeet Shah Chemical / Telecom 022-68190541 Sumeet.shah1@adityabirlacapital.com
Mahavir Jain Mid – Cap 022 6819 0518 mahavir.jain@adityabirlacapital.com
Advik Shetty IT / M&E / Healthcare 022-6819 0541 advik.shetty@adityabirlacapital.com
Mohan Jaiswal Technical Analyst 022-6819 0515 mohan.jaiswal@adityabirlacapital.com

ABML research is also accessible in Bloomberg at ABMR

21
Disclaimer:
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investors. ABM also caters to investments in Debt instruments and Mutual funds through it digital platform to diversify asset allocation. As a depository participant, ABM has equity assets under custody worth around Rs. 25,000
crores catering to over 3 lac investors who can hold Stocks & Securities, Mutual funds and Insurance policies in electronic form.
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The information , opinion, views contained in this document are as per prevailing conditions and are of the date of appearing on this material only and are subject to change. No reliance may be placed for any purpose whatsoever
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herein may be subject to updating, completion, revision, verification and amendment and such information may change materially. Past performance is no guarantee and does not indicate or guide to future performance.
Nothing in this document is intended to constitute legal, tax or investment advice, or an opinion regarding the appropriateness of any investment, or a solicitation of any type. The contents in this document are intended for general
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Regulations, 2014. SEBI Reg. No. INH000002145

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