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Sensex at 12pm: Entry norms for FIIs to be eased further.59pm: Fresh bout of selling drifts Sensex to fresh 3-month low Sensex at 11 am: FM begins Budget speech.18pm: Disappointment from the Budget led to sell-off. 19286.3 lakh crore from the market.2 percent and FY14 fiscal deficit seen at 4.31 points.How the Sensex moved to major announcements on Budget Day Sensex at open: 19264.43pm: Government to borrow Rs 6. Sensex at 12.80.21pm: Super Rich Tax . Sensex at 3. down 290 pts Market Commentary: Sensex nosedives 290 pts as Budget 2013 flops Top Gainers I Top Losers I Most Active I Commodities I Global Indices . up 134.30pm: TDS of 1 percent on sale of immovable property valued over Rs 50 lakh.54. Sensex at 02. Sensex at 01.16pm: Fiscal deficit for FY13 at 5.72. up 112.39 lakh crore.8 percent.39 points Sensex at 11.11pm: Additional tax deduction of Rs 1 lakh for first time buyers of houses valued up to Rs 25 lakh Sensex at 12.46am: Extra investment allowance of 15% for corporates investing over Rs 100 crore in plant and machinery.30pm: Highest ever turnover of Rs 4. 18861. Sensex at 12.Surcharge of 10 percent on those with a taxable income of over Rs 1 crore Sensex at 12. Sensex at 12.
Duty on imported luxury goods such as high end motor vehicles. Fiscal deficit for FY13 at 5. Additional deduction of interest up to Rs 1 lakh for a person taking first home loan up to Rs 25 lakh during period 1.“Compared to expectations. motor cycles. Entry norms for FIIs to be eased further.4.2 lakh crore.3. For full article. Government to borrow Rs 6.2 percent and FY14 fiscal deficit seen at 4.2013 to 31. while most players were expecting this figure to be around Rs 5.2014 Foreign portfolio investment in excess of 10 percent in an Indian company will be classified as foreign direct investment.8 percent. Rajiv Gandhi Equity Savings Scheme to be liberalised. Surcharge on corporates with income over Rs 10 crore raised to 10 percent from 5 percent. A tax credit of Rs 2000 to every person with total income in the first bracket of Rs 2 lakhs to Rs 5 lakhs.3 lakh crore from the market. FM has delivered a mouse” Key Takeaways Surcharge of 10 percent on those with a taxable income of over Rs 1 crore. Click here . yachts and similar vessels increased.
Sector: FMCG Expectations Increase in excise duty on cigarettes. Proposals Specific Excise Duty on cigarettes increased by 18%.500/MT. Proposals Excise duty on SUVs up from 27% to 30%.000 Extension of Countervailing duty at 6%. Cess on crude oil production might be increased from current levels of Rs 4. Expect the general excise duty rate to be maintained at 12%. Impact Positive for the upstream companies like Reliance. Sector: Oil & Gas Expectations NELP blocks will be cleared. Proposals Import duty on crude oil might be re-imposed. . New oil and gas exploration policy will be formulated on revenue sharing. Higher allocation to JNNURM leading to additional demand of 10. customs duty 0% Maintain customs duty of 75% on luxury vehicles. Shale gas exploration policy to be formulated.Sector: Auto Expectations Levy of additional duty of Rs 80.000 buses augurs well for all commercial vehicle manufacturers. Clarity on implementation and timelines of GST will be positive. Higher allocation to JNNURM positive for all commercial vehicle manufacturers. Tax on royalty increased from 10% to 25%. Impact Cigarette companies will pass on the increase to the customers. Removal of 5% customs duty on LNG and natural gas. Impact Negative for M&M and Tata Motors. ONGC. This could marginally impact volume growth. Customs duty on luxury vehicles hiked to 100%.
Impact Positive for the sector. deepening of bond markets. housing and railways. family welfare in FY14. Proposals Extension of 4% farm loans to private banks. Easing of investment norms. Increase the list of life-saving drugs to 5% concessional duty New oil and gas exploration policy will be formulated on revenue sharing. ports. 3000 km of road projects to be awarded in first 6 months of FY14. Reduction in STT. Introduction of commodity transaction tax on non-agri contracts Proposals Constitution of a regulatory authority for road sector.000 crore. To allot Rs 37333 crore for healthcare. IDFs will be encouraged to provide long-term low-cost debt Proposals Royalty/technical fees paid to NRIs increased to 25%. Impact Negative for private sector banks. It will boost infrastructure development in roads. Increase in royalty fees marginally negative for Ranbaxy . Introduction of CTT negative for broking companies. Additional deduction of Rs1 lakh interest on housing loans of up to Rs25 lakh. Positive for PSU banks. Reduction in STT Sector: Infra Expectations Higher allocation to infrastructure spending. Impact Higher allocation is positive for the sector. Higher allocation to infrastructure tax free bonds. Sector: Pharma Expectations Exempt all life-saving medicines from proposed GST. Elimination of hurdles for roads and highways.Sector: Banks/Financials Expectations Expects capital infusion of around Rs 20.
MADHU KELA Reliance Capital The Budget is encouraging as FM has not thrown any negative surprises. He did not speak on how the current account deficit will be handled. No direction changing moves announced to revive markets.UDAY KOTAK Kotak Mahindra Bank The Finance Minister has lived up to his promise on fiscal deficit. NILESH SHAH Axis Direct The RBI's next step potentially could be towards rate cut because now they have been given a space on the fiscal deficit side. VALLABH BHANSHALI Enam Securities FM has done more good than bad. SAMIR ARORA Helios Capital The Budget 2013-14 turned out to be unexciting for equity markets. Fiscal deficit projection of 4.8% looks credible. The Budget 2013-14 is good for capital markets and investments. The market will resume downtrend from now onwards. . VIBHAV KAPOOR IL&FS With the limited options FM has done a decent job.
We have had one of the worst years in a decade and one cannot expect miracles from him. ADI GODREJ Godrej Industries FY14 Budget is a growth oriented one and the emphasis remains on inclusiveness.DEEPAK PAREKH HDFC It is a very realistic. I would rate budget as 7. . PAWAN GOENKA M&M Don't agree with excise duty hike on SUVs. Diesel tax not being implemented is very good news for the sector.5/10. balanced. Expenditure and execution is important. R SHANKAR RAMAN L&T The challenge always has been to convert some of these targets like 3000 kms of new roads into implemental plans. CHANDA KOCHHAR ICICI Bank Private sector banks have been given a level-playing field vis-a-vis the public sector banks. and pragmatic Budget. Our aim is to increase mining with available reserves. KOUSHIK CHATTERJEE Tata Steel The focus would be on how more efficiently coal can be mined.
Positive for Coal India. ICICI Bank Proposal: 4% farm loan scheme extended to private sector banks. up 22%. Negative for private sector banks. Proposal: To allot Rs 37333 crore for healthcare. ONGC Proposal: To announce policy on Shale gas based on revenue sharing. Negative for ITC. fertilisers and pesticides. Positive for Reliance Inds. Tata Motors. SBI Sun Pharma Jain Irrigation Proposal: Rs 27. Monsanto. Positive for public sector banks. Positive for realty. Coal India Proposal: To encourage PPP projects for coal. All Women’s Bank to be set up via public sector.000 crore for public sector banks recapitalisation. family welfare in FY14: Positive for pharma stocks. Proposal: To provide Rs 14. Blocked NELP blocks will be cleared.049 crore allocated to Ministry of Agriculture.ITC Proposal: SED on cigarettes hiked by 18%. ONGC. . Positive for Jain Irrigation. DLF Proposal: House loans up to Rs 25 lakh will be allowed an additional deduction of interest of Rs 1 lakh. Tata Motors Proposal: Excise duty on SUV upped to 30% from 27. Negative for M&M.
construction companies. . Proposal: Bank correspondents can sell micro finance products. Proposal: No custom duty for plant. Proposal: Extension of sunset clause for profit-linked incentive by one year: Positive for the power sector. SKS Micro Sadbhav Engineering Proposal: 3000 km of road projects will be awarded in first 6 months of FY14. Positive for Suzlon. NTPC Century Textiles Proposal: Propose technology upgrade scheme for textile sector to Rs 2400 crore in FY14. Positive for Triveni Engineering. Alok. Positive for SKS Micro. Suzlon Energy Proposal: Higher allocation for wind energy.260 crore towards clean drinking water & sanitation. SPEL. Moschip Speciality Restaurants Proposal: Finance Minister to impose service tax on all AC restaurants. Positive for Moschip.877 Cr has been allocated to education. Positive for Century Textiles. Arvind. Positive for education stocks.Educomp Solutions Proposal: Rs 65. up 17% from FY13. machinery for semiconductors. Va Tech Wabag. Negative for Speciality Restaurants. Triveni Engineering Proposal: Allocation of Rs 15. Positive for Sadbhav Engineering.
Tax credit of Rs 2000 for income between Rs 2-5 lakh.5-5 lakh 5-10 lakh Above 10 lakh POST BUDGET 2. MALE: No change in tax slabs.5 lakh 2. TAX RATE Nil 10% 20% 30% NOW 2. TAX RATE Nil 20% 30% NOW 5 lakh 5-10 lakh Above 10 lakh POST BUDGET 5 lakh 5-10 lakh Above 10 lakh Click here to use our tax calculator to find out your new tax structure.Super Rich Tax: 10% Surcharge on income above Rs 1 crore.5 lakh 2. . TAX RATE Nil 10% 20% 30% NOW 2 lakh 2-5 lakh 5-10 lakh Above 10 lakh POST BUDGET 2 lakh 2-5 lakh 5-10 lakh Above 10 lakh SENIOR CITIZEN: No change in tax slabs.5-5 lakh 5-10 lakh Above 10 lakh VERY SENIOR CITIZEN: No change in tax slabs. TAX RATE Nil 10% 20% 30% NOW 2 lakh 2-5 Lakh 5-10 lakh Above 10 lakh POST BUDGET 2 lakh 2-5 Lakh 5-10 lakh Above 10 lakh FEMALE: No change in tax slabs.
Cigarettes Set Top Boxes Yachts MP3 Players Silk SUVs Mobile phones (GSM) Marble Passenger cars MUVS Diamonds Leather Goods Readymade Garments Imported Jewellery Electrical plants Handmade carpets .
6% 8.2-6.0% 4. emphasizing the continued need for reforms in the coming months with an outlook for the next fiscal pointing towards gradual improvements.1-6. draws out a rather cautious picture of the year gone by. .7 percent range next year. The Survey based on developments of FY13. Revival of investment in infrastructure is one of the key challenges before the government.GDP Trend & Forecast 12.0% 0.0% 6.6% 9.7% 6.6 percent by March this year.0% 9.3% 2.0% GDP Growth Rate% 10.2% 5.3% 8. Wholesale price inflation is seen between 6.0% 6.0% 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 Key Takeaways The government expects GDP to grow in 6.0% 9.
3 percent for the current year. given adverse local and global factors The only way current account deficit can be kept in check is by reducing imports of gold and oil.0% 6.5% 4. and that the government needs to raise diesel and LPG prices in line with global rates.0% 2.0% 5.0% 4.0% 0. .0% 1. There is limited room to grow exports.8% 6.0% 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 3.0% 3.0% 6. Revenue collection target for FY13 is likely to be significantly below target.Fiscal Deficit Fiscal Deficit as % of GDP 7.3% Key Takeaways The Government will be able to achieve its fiscal deficit target of 5.7% 5. The Survey sees oil subsidies as a key fiscal risk.3% 2.5% 5.
56 Savings Rate as % of GDP Savings Rate % 35 34 33 32 31 30 29 34.7 32.8 15 10 5 0 FII (USD Bn) 8.2 12.1 304.2 -4.Current Account Deficit % to GDP 0 -1 -2 -3 -4 -5 -4.4 295.92 45.8 5.8 294.6 -2.5 Average Exchange Rate USDINR 57 54 51 48 45 42 39 54.8 .6 FDI & FII Flows FDI 32.47 47.4 35 30.8 Foreign Exchange Reserves Reserves (in USD Bn) 310 300 290 280 270 260 279.44 Inflation Rate Inflation% 12 9 6 3 0 3.9 11.8 47.8 -2.6 22.0 30.9 7.1 17.8 9.3 30 25 20 17.0 33.
000 crore for the next 4 years. New system to enable booking of 7. tatkal charge.000 now. freight revenues eyed” Key Takeaways No hike in passenger fares.600 crore versus Rs 22. 26 new passenger trains. Railways to launch 67 new express trains. iron ore. Railways to introduce AC coaches for Mumbai suburban network in FY14. cement. LPG.500 crore year ago. Rail Budget – Full Speech I Analysis I Rail Budget Highlights – Full article .“No hike in passenger fares. Freight charges on diesel. Railways to raise Rs 95. FY13 railway losses seen at Rs 24. steel.8%. Railways propose no hike in Reservation fee.200 tickets per minute versus 2. urea up by 5.
Texmaco Rail. Titagarh Wagons Proposal: To introduce AC coaches for Mumbai suburban coaches. Positive for Gammon Infra. Suzlon KEC International Proposal: Railways to set up equipment signaling plant at Chandigarh via PPP. L&T. Proposal: Railways to set up coach manufacturing facility at Haryana. Titagarh Wagons. Verdict Railway Budget turned out to be a non-event.Coal India Proposal: Rs 4. Texmaco Rail Gammon Infra Proposal: Rs 9. Proposal: Railways to complete electrification of 1. Positive for Texmaco.200 km. Major railway stocks like Kalindee Rail. Siemens Proposal: Railways to set up 75 MW windmill plants. NCC. ACC Proposal: Freight rates to go up by 5. Negative for cement.8%. . Titagarh. Texmaco Rail saw a huge sell-off in trade. BEML. Kernex. Bhel Proposal: Railways to set up electromotive unit in Rajasthan in joint venture with BHEL.000 crore has been allocated for port and mine connectivity. iron ore and urea companies. Positive for Titagrah Wagons. steel.000 crore has been allotted for coal mine connectivity projects. Railway Minister P K Bansal failed to deliver some big ticket announcements.
On the house property front there is an attempt to encourage first time investors through a higher deduction that will be available for repayment of interest on housing loans. . The individual can choose this as a long term option for parking their funds for 10 to 15 years and this will not have an adverse tax impact because of the fact that the income will be tax free in their hands. There will also be a better option available for those who want to protect their real rate of return because there will be the introduction of inflation linked bonds and inflation linked National Savings Certificates. The Rajiv Gandhi Equity Savings Scheme (RGESS) has also witnessed some small changes wherein the income limit for being eligible for the scheme has been raised to Rs 12 lakh. One bit of good news is that the investors will have a choice of tax free infrastructure bonds for one more year as there has been a permission given for the issuance of these bonds.Investors to face some small changes following Budget . Conservative investors as well as senior citizens can make use of this opportunity when it becomes available. Financial Planner Investors will witness some incremental changes as far as their investment plans are concerned in the coming financial year following the announcement of the Union Budget 2013-14. Once again this can be easily claimed because of the fact that is can be taken over a two year time period. This will ensure that the interest rates earned by the investor moves along with the changes in the overall interest rates and hence there is protection in times when inflation rises in the economy. The choice of instruments in the scheme has also been increased as equity oriented funds have been included in the eligible list of investments which will help the investor to choose a fund as per their liking. For a first time buyer if the value of the property is Rs 40 lakh or less and if the housing loan is Rs 25 lakh or lower then an additional deduction of Rs 1 lakh would be available over and above the existing Rs 1. This would increase the burden on the individual in terms of compliance and effort in deducting and depositing the tax with the government. At the same time the benefit can be claimed over a period of three years as compared to the one year time period that exists currently which means that the investor can actually phase out their investments to suit their requirements.5 lakh deduction. These will not mean a major deviation from their existing plans though they will be able to make use of some additional options in their investment mix. However the provision for a tax deducted at source at the time of sale of the house property if the value of this is Rs 50 lakh or higher would be a negative.Arnav Pandya.
and the FM restrained himself from any dose of excess populism. Chidambaram has raised Rs 18. For full article. some very small personal income tax reliefs. which the markets misunderstood to mean something that will send the adrenalin pumping. which is what his predecessor managed to do. both to populism and the middle classes.000 crore additional provision for Sonia Gandhi’s Food Security Bill. but he could not oblige. A lo-calorie budget is not meant to energise anybody. He has delivered on his promise of providing a “responsible” budget. Click here . are minor: there is a token Rs 10. Before we rush to condole those left out of accessing the meagre basket of goodies.5 lakh). It is meant to get the fat down. Excise and customs remain more or less the same. Plus there are promises on new savings instruments sold through post offices that will be inflation-indexed. not even his own party. it’s because Chidambaram has already given them enough room for optimism before the budget. There is thus nothing in it to excite anybody. The markets wanted more of the same. which set the stage for the economy’s long-term slide and made inflation intractable.Why Chidu's Lo-Cal budget is a flop-show -R. That was not on. with the Sensex and Nifty heading south. and an additional deduction of Rs 1 lakh for interest paid on first home loans (over and above existing Rs 1. Jagannathan Editor. Firstpost at Network 18 If Palaniappan Chidambaram’s eighth Budget has not set the markets on fire. the former mostly by taxing companies more. The concessions. It is meant to get the fat down.000 crore of additional revenue through direct and indirect taxes. Budget 2013-14 has taken the middle path of low ambition and low risk. A lo-calorie budget is not meant to energise anybody. But these will not be more than sideshows to the main avenues currently available for savings. it can be easily explained: his first goal was to avoid doing damage to investor confidence. If the markets are moping right now. And unlike his own 2008 budget. with no changes in base rates. it is worth summarising the core proposals made in the budget.
lower than the revised subsidy bill of Rs 2. The FM said that current account deficit was a bigger problem than fiscal deficit. And that is where he appears to have fallen short. Click here . the FM has not slashed Plan Expenditure for FY14 in a big way as many had feared. While he has promised on a fiscal deficit target of 4.Budget: Chidambaram plays safe.31 lakh crore. and that was only to be expected considering that general elections are due in barely a year. On the positive side.000 crore was much lower than what the market had feared. But market may take the subsidy estimate for FY14 with a pinch of salt.5 lakh crore is about 29 percent higher than the revised estimate of Rs 4. But what the market was hoping from the architect of the Dream Budget was some kind of a road map on how growth and the investment cycle could be revived in the near future. on how subsidies could be meaningfully lowered. To be fair. Also. At a time when private investments have dried up. But the Budget did not have anything specific on how oil and gold imports will be curbed. and to that extent. Additional provision for the Food Security Bill at Rs 10. Moneycontrol at Network 18 Much was expected of Finance Minister P Chidambaram in Budget 2013 considering that he had marketed it aggressively to foreign institutional investors in the last few ways. But investors and the industry are questioning the wisdom of achieving fiscal targets through cost-cutting.8 percent for next year. how he achieves that will be the key. The estimate of Rs 5. he has delivered on two key parameters: fiscal consolidation and a stable tax regime. considering that the revised estimate for FY13 was about 35 percent higher than the initial estimate. The subsidy bill for fuel. It was never easy going to be raise taxes in a slowing economy. fertiliser and food together for FY14 is estimated at Rs 2. which has been doing aggressively over the past few months. There has been a sharp increase (46 percent) in allocation to the Rural Development ministry.29 lakh crore for FY13. The only other way out for the Finance Minister has been to cut back on expenditure. The current year’s target was achieved by trimming Plan Expenditure by around Rs 1 lakh crore. The FMCG industry must be hoping that a pickup in rural consumption should add to their bottomlines. a cutback in government spending could further crimp growth near term.57 lakh crore for FY13. For full article. the status quo on key tax rates should come as a relief even if was only to be expected. market disappointed -Santosh Nair Editor.
put in an aggressive 4. to suddenly tell a foreign investor his category might change without his will. where an investor has a stake of 10 percent or less in a company.. A committee will be constituted to examine the application of the principle and to work out the details expeditiously. Half baked because there are no details forthcoming. put through several rounds of debate and then proposed! But if think this is bad. where an investor has a stake of more than 10 percent. is not a good idea. foreign investment is an imperative.only to wipe it off an hour later. I propose to follow the international practice and lay down a broad principle that.8% fiscal deficit target. striking the right note in a country starved of investments and faced with declining growth.P Chidambaram.February 28th: History repeats itself? Menaka Doshi Corporate Editor.. "In order to remove the ambiguity that prevails on what is Foreign Direct Investment (FDI) and what is Foreign Institutional Investment (FII). and I propose to plug the loopholes. In a country home to complex. foreign investment caps and confusing tax treatments for different classes of foreign investors. spoke of capital market reform and then suddenly threw in this half baked idea. Finance Minister That’s how Finance Minister P Chidambaram opened his Budget speech on Thursday. I could say the same about his next proposal.” . "Some tax avoidance arrangements have come to notice. He announced bits and bobs of infrastructure investments. does not have the choice between welcoming and spurning foreign investment." . at the present juncture.P Chidambaram.. Finance Minister That was the first surprise. For full article. it will be treated as FII and. He must have put a smile on the faces of foreign investors.think again. it will be treated as FDI. Some unlisted companies have avoided dividend distribution tax by arrangements involving buyback of shares. If I may be frank. I just wish this had been eased in via a separate discussion paper.this one watched even more closely as it comes in an environment of declining growth and follows an epoch-making budget that include 24 retroactive amendments. Finance Minister There's no denying that some MNC structures have used this loophole so the FM's misgivings are justified as is his desire to plug the loophole..” . CNBC-TV18 "I have been at pains to state over and over again that India. High profile events are not the place to showcase meagrely worded ideas.. Click here . Till here the speech was going fairly well.P Chidambaram. sectoral.. I propose to levy a final withholding tax at the rate of 20 percent on profits distributed by unlisted companies to shareholders through buyback of shares. Indian budgets are high profile events. being introduced for the first time.
” # @kunalrao “Women's bank? Will they be closed once a month for 4 days?” .The Twitterati gloss over Chidambaram’s Budget # Dr Manmohan Singh @PMOIndia “Given the challenges facing our economy. jise apne ghar ke Budget ke bare mein pata nahin. Sad. one has to fight harder to succeed in one's own country" # @Trendulkar “Keeping money in the blouse is the original women's bank. I welcome all the women oriented schemes announced by the FM. the Finance Minister has done a commendable job. Singling out SUV's destroys a level field. We can’t stop rapes. But we want to open a bank for women.” # Narendra Modi @narendramodi “Budget 2013-14 showcases UPA's disconnect with the people! Unemployment & inflation will continue to bother common man. crimes against women. woh desh ke Budget pe kya bolega!” # Anand Mahindra "No quarrel if ALL large cars taxed. As if women can’t use normal banks!” # Amitabh Bachchan @SrBachchan “Ama yaar.” # Pritish Nandy "Wonderful.” # Kiran Mazumdar Shaw @kiranshaw “Women have certainly occupied center stage in Budget 2013.
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