15 Stocks To Buy Buy Ahead Of The Union Budget 2022-23

Sharekhan has come-up with its stock previews ahead of the Union Budget, 2022-23. According to Sharekhan, the government's agenda in Union Budget 2022- 23 would be marked by the beginning of fiscal consolidation given a high deficit and a surge in revenue collections.

Stocks to buy ahead of the Union Budget 2022-23

Sharekhan has highlighted its budget preview picks. The brokerage has highlighted 15 such stocks to buy ahead of the Union Budget.

The 15 include: ICICI Bank, SBI, HDFC Ltd, Reliance Industries, Thermax, Tata Power, L&T, Bharat Electronics Ltd, Tata Motors, Ultratech, M&M, DLF, Power Grid, HCG, Globus Spirits

The brokerage has not highlighted any specific reason why these stocks should be bought into ahead of the Union Budget.

In any case, most of the above mentioned stocks are high quality names and are recommended as "stocks to buy" by several brokerage outfits. However, some of them like ICICI Bank have already had a relentless rally over the last 1-year.

Fiscal consolidation

According to Sharekhan in the Union Budget, the path of fiscal trajectory would be the most important part of the Union Budget 2022-2023, given that the fiscal deficit is higher than the historical average, triggered by the pandemic.

"Owing to the current fragile status of the economy, government support is still needed to sustain the ongoing economic momentum. Hence, the government may not opt for an aggressive fiscal consolidation path here on and will have to maintain a balance between economic growth and fiscal consolidation, which should bode well for the bond market. Given a sharp rise in GST collection and higher advance taxes, the government may find some cushion in actual fiscal deficit in FY22 despite revenue loss due to cuts in fuel excise duties, higher subsidies and a rise in expenditures due to extension of free foodgrain scheme until March 2022.

The government is likely to maintain its fiscal deficit target at 6.7% for FY22E," the brokerage has said.

Kick Starting the economy high on the agenda

According to Sharekhan, given the need to support economic revival, kick-starting the investment cycle would continue to be high on the policy agenda.

"Recent reports indicate that the budgetary allocation on capital expenditure could be around Rs. 6.5 trillion in 2022-23, up by close to 20% as compared to Rs. 5.5 trillion (26% up from 2019-20) in 2021-22.

Further, sustained focus towards the production-linked incentive and National Infrastructure Pipeline schemes, tax incentives for investments in Infrastructure Investment Trusts (InvITs) and continued thrust towards investments in agri infrastructure such as cold storage, warehousing, etc. are likely to be seen in upcoming Budget. Notably, so far, private investments remain sluggish in the country, which is of utmost importance to sustain ongoing recovery.

Disclaimer

The above stocks are picked from the brokerage report of Sharekhan. Greynium Information Technologies and the author are not liable for any losses caused as a result of decisions based on the article. Investing in equities is risky. Invest only if you have an appetite for risk. The author and his family do not own shares in any of the companies listed above.