Indian equity benchmarks rose modestly in a special trading session on Sunday after the government reiterated its commitment to supporting economic growth through higher capital spending and targeted measures for manufacturing, pharmaceuticals and electronics.
The government said it would spend a record Rs 12.2 trillion on infrastructure in the coming year, reinforcing its focus on capex-led growth.
The Nifty 50 rose 0.12 per cent to 25,351.35, while the BSE Sensex added 0.18 per cent to 82,408.02 in the afternoon session.
Capital goods and infrastructure stocks outperformed, with Larsen & Toubro, PNC Infratech, IRB Infrastructure, NBCC and Action Construction Equipment rising between 1.3 per cent and 6 per cent on expectations of higher government-led project spending.
Analysts said sustained capital expenditure could support long-term earnings visibility and help justify higher equity valuations over time.
“In the long term, such aggressive capex can have several long-term implications. Infrastructure and heavy engineering companies are likely to see improved order books and revenue growth. Sectors like steel, cement, power, and transportation could benefit from sustained demand,” said Divam Sharma- Co Founder and Fund Manager at Green Portfolio PMS.
Auto stocks gained around 1 per cent, led by Mahindra & Mahindra and Tata Motors’ passenger vehicle business on the back of upbeat monthly sales data.
The broader small-cap index fell 1 per cent, while mid-caps were largely flat, indicating selective buying rather than a broad-based rally.
Pharmaceutical stocks rose 0.5 per cent, with Biocon leading gains after the government allocated Rs 100 billion (USD 1.09 billion) over five years to support the biopharma sector.
Electronics manufacturing services firms such as Dixon Technologies, Amber Enterprises and Kaynes Technologies climbed about 4 per cent each after the government proposed an increase in outlays for electronic components manufacturing.
Textile stocks also advanced, with Gokaldas Exports, Vardhman Textiles, KPR Mill and Arvind rising between 2.2 per cent and 6 per cent after the finance minister announced the setting up of mega textile parks and outlined a five-point plan to support the sector.
Mining-related stocks such as Gujarat Mineral Development Corporation and Orissa Minerals Development Company gained 3.3 per cent and 3 per cent, respectively, following budget proposals to support Odisha, Kerala, Andhra Pradesh and Tamil Nadu in developing rare-earth corridors.
Power financiers Power Finance Corporation and REC jumped about 3.5 per cent each after the government outlined plans to restructure the two state-run lenders. |
