Jefferies India has termed the Union Budget as a “pragmatic approach” with “no fireworks,” stating that while it does not offer immediate catalysts for equity markets, it lays the foundation for a stable medium‑term growth environment.
According to the brokerage, a key positive from the budget is the renewed focus on capex, driven by defence, adding this was facilitated by slower fiscal consolidation.
Jefferies noted that support to data centres and electronics component manufacturing was encouraging, reflecting the government’s continued push to strengthening the domestic technology and manufacturing ecosystem. However, it cautioned that the negative was potentially higher bond yields, which posed pressure on rate‑sensitive sectors. The brokerage also raised concerns over the hike in securities transaction tax (STT), calling it negative for rate sensitive stocks. It said higher STT signalled the government’s discomfort with elevated derivatives (F&O) trading volumes.
While the brokerage does not see any immediate trigger for equity markets, it said the government’s strategy is clearly aligned with long‑term export competitiveness, with export boost remaining the key policy direction.
Jefferies pointed to the large disinvestment budget, which indicated the IDBI bank divestment could be concluded in FY27.
On sectoral impact, Jefferies said the budget is positive for L&T and cement companies due to higher infrastructure capex, as well as for defence companies. It said companies like Amber and Syrma also stand to gain from higher allocations under the electronic manufacturing PLI (production linked incentive) scheme, Lodha on a data centre-related trigger, and PayTm owing to incentives for digital payments. On the flip side, it said the budget was negative for yield plays like NBFCs, capital market companies like BSE, Groww etc due to the STT hike, and for Dixon due to lower allocations under the mobile PLI scheme.
Finance Minister Nirmala Sitharaman presented a Rs 53.47-lakh crore Budget for 2026-27, up 7.7% from the current financial year ending March 31. As per the revised estimate, the size of the budget for the current fiscal is Rs 49.64 lakh crore, lower from Rs 50.65 lakh crore estimated in February 2025. The Budget for fiscal 2024-25 was at Rs 46.52 lakh crore.
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