The Nifty 50 closed a volatile session with a flat-to-negative bias after trading within a 300-point range on February 1, as the Union Budget presented by the Finance Minister largely aligned with market expectations. The annual budget primarily focused on the consumption segment through tax relief, while clearly maintaining its fiscal consolidation path by setting a 4.8 percent target for FY25 and 4.4 percent for FY26, along with a better-than-expected allocation for capital expenditure for FY26 (Rs 11.21 lakh crore) compared to revised estimates for FY25 (Rs 10.18 lakh crore). The impact was clearly seen in FMCG, consumer durables, real estate, and auto stocks, which recorded 2-3 percent gains.
The government announced several measures, including an increase in the foreign direct investment (FDI) cap for the insurance sector, the rationalization of customs duties to boost domestic manufacturing, and tax incentives for strategic industries, including technology, renewable energy, and defense. These measures indicate a push toward long-term economic stability, experts said.
According to Nimesh Chandan, CIO at Bajaj Finserv Asset Management, the budget is likely to have a positive impact on the economy, businesses, and markets. "Among the major economies, India has seen the best fiscal consolidation. This also creates room for monetary easing by the RBI," he said.
The Reserve Bank of India will announce its first monetary policy of the current year in February, and most experts foresee a 25 bps cut in the repo rate.
The recovery post-Covid-19 was a ‘K’ shaped recovery, wherein the upper segment has done well, but the middle and lower levels did not grow much. This budget aims to address this disparity by reducing the burden on middle-class taxpayers, Nimesh said.
According to Deepak Shenoy, CEO and Founder of Capitalmind, the increased money in people's hands should give a solid boost to consumption, consumer durables, and tourism. "The MSME sector incentives will boost manufacturing. Manufacturers of lithium-ion batteries and electronics, thanks to lower import duties, will also benefit. The big push on shipping—especially inland shipping—will give the industry a much-needed boost," he said.
Additionally, "with a lower fiscal deficit, we could see interest rates come down, making room for potential rate cuts. That, in turn, should spur private capex and encourage more lending by banks and NBFCs, further driving economic growth," Shenoy said.
The Nifty 50 fell slightly by 26 points to finish the first session of February at 23,482, but recorded 1.7 percent gains for the week with above-average volumes, forming a bullish engulfing pattern— a bullish reversal pattern after three weeks of correction. The Bank Nifty also behaved similarly, falling 80 points to 49,507 but rallying 2.4 percent during the long working week.
Moneycontrol collated a list of 9 budget-sensitive stocks from experts that can provide better returns in the short term.
Hardik Matalia, Derivative Analyst at Choice Broking
Hindustan Unilever | CMP: Rs 2,506
Hindustan Unilever (HUL) has given a strong breakout from a parallel channel on the daily timeframe. This breakout is backed by consistent trading volumes, indicating strong buying interest. The stock had been consolidating in a range near a crucial demand zone, forming a parallel channel pattern. A rebound from this support zone has provided fresh bullish momentum, signaling a potential continuation of the uptrend.
Technically, HUL has surpassed its long-term exponential moving average (EMA) and is trading above all its key moving averages (10, 20, 50, and 100-day EMAs). This confirms the stock's strength and the possibility of further upside. If the stock sustains above the critical level of Rs 2,600, it could potentially move toward a higher target range of Rs 2,740-2,800 in the near term. A sustained breakout above this key level could attract additional buying interest, further validating the bullish setup.
Given the current technical structure, fresh buying is recommended at the current price, with an opportunity to add on dips near Rs 2,450. A strict stop-loss should be placed at Rs 2,420 on a closing basis to manage risk effectively. On the upside, the stock has the potential to rally towards Rs 2,700-2,800 levels in the coming sessions. Traders should closely monitor price action near the Rs 2,600 mark for confirmation of further strength.
Strategy: Buy
Target: Rs 2,700, Rs 2,800
Stop-Loss: Rs 2,420
Life Insurance Corporation of India | CMP: Rs 848.2
Life Insurance Corporation of India (LICI) has given a breakout from its consolidation range and a falling trendline, signaling a potential trend reversal. After witnessing selling pressure from higher levels, the stock moved sideways near its support zone, forming a strong base. This consolidation has resulted in the formation of a double-bottom pattern on the daily timeframe, which is a bullish reversal pattern, indicating a shift in momentum towards the upside.
The stock has surpassed its short-term exponential moving average (EMA) but is facing some resistance near its medium-term EMA. If it manages to break above this hurdle, it could test its long-term EMA, further strengthening the bullish outlook. Additionally, the Relative Strength Index (RSI) is currently at 48, showing a reversal from lower levels and trending upwards, which supports the possibility of further price appreciation. If LICI sustains above the key level of Rs 875, it could witness a strong upward move toward the higher targets of Rs 930-980.
Considering the technical structure, buying at the current price is recommended, with an opportunity to add on dips near Rs 830. A strict stop-loss should be placed at Rs 800 on a closing basis to manage risk effectively. As long as the stock holds above its support levels and surpasses its medium-term EMA, it remains well-positioned for an upside rally. Traders should closely monitor price action near Rs 875 for confirmation of further strength.
Strategy: Buy
Target: Rs 930, Rs 980
Stop-Loss: Rs 800
Eicher Motors | CMP: Rs 5,394.5
Eicher Motors has recently demonstrated a strong rebound from the support level around Rs 4,930, reaching an all-time high of Rs 5,423. The daily chart exhibits a strong bullish candle, decisively breaking the resistance at Rs 5,400 and forming a higher high and higher low pattern. This price action signals a potential continuation of the bullish reversal trend. The optimistic outlook is further reinforced by rising trading volumes, reflecting increased buying interest.
The RSI currently stands at 68.20 and is trending upward, indicating increasing buying momentum. Additionally, the stock is trading above its 200-day, 50-day, and 20-day EMAs, further strengthening the prevailing positive trend. If Eicher Motors sustains levels above the key Rs 5,500 mark, it is likely to continue its upward momentum, with a potential target of Rs 6,000.
Given the current technical setup and momentum, Eicher Motors presents an attractive opportunity to buy on dips up to Rs 5,200, with a target price of Rs 5,800. On the downside, a stop-loss should be placed at Rs 5,000. This trade setup offers a favourable risk-reward ratio, making it a promising opportunity for traders looking to capitalize on the ongoing bullish trend. However, it is essential to adhere to proper risk management strategies to safeguard against unexpected market volatility.
Strategy: Buy
Target: Rs 5,800, Rs 6,000
Stop-Loss: RS 5,000
Anshul Jain, Head Of Research at Lakshmishree Investments
Zomato | CMP: Rs 235
Zomato is making a strong attempt to reclaim its uptrend, with Rs 240 emerging as a key resistance level. The stock’s accelerating momentum suggests high odds of a successful breakout. Additionally, government tax cuts will inject fresh money into consumers’ pockets, boosting discretionary spending—a major positive for Zomato and Blinkit. A breakout above Rs 240 could propel the stock towards Rs 300, with Rs 220 as a stop-loss.
Strategy: Buy
Target: Rs 300
Stop-Loss: Rs 220
Campus Activewear | CMP: Rs 291
Campus Activewear is showing strong bullish momentum, with trading volumes surging 3x above its 50-day moving average. The government’s recent push for the leather industry in the budget further strengthens the growth outlook for the stock and sector. Technically, Rs 290 is an attractive entry point, with Rs 270 as a stop-loss and a potential upside toward Rs 330. With rising demand and favourable policies, Campus could step into a strong uptrend.
Strategy: Buy
Target: Rs 330
Stop-Loss: Rs 270
Jubilant FoodWorks | CMP: Rs 739
Jubilant FoodWorks is eyeing a major breakout, attempting for the second time to surge above the classic Cup and Handle pattern. With the government’s tax cuts boosting disposable income, consumer spending is set to rise, favouring the quick-service restaurant giant. A decisive move above Rs 735 could trigger a rally toward Rs 850, with Rs 685 serving as a prudent stop-loss. Bulls are watching closely—if momentum sustains, this could be a tasty breakout!
Strategy: Buy
Target: Rs 850
Stop-Loss: Rs 685
Vidnyan S Sawant, Head of Research at GEPL Capital
Time Technoplast | CMP: Rs 388.4
Time Technoplast remains in a rising trend, with January witnessing a 20 percent correction from its swing high. Notably, since January 2024, the stock has exhibited a repetitive price pattern, typically correcting by 17-25 percent before surging approximately 40 percent, indicating a setup for a strong upward move. On the weekly scale, the stock has demonstrated a change in polarity, where the prior resistance from July 2024 is now acting as a support level, further reinforcing its bullish outlook.
Strategy: Buy
Target: Rs 469
Stop-Loss: Rs 372
PG Electroplast | CMP: Rs 800.5
PG Electroplast maintains a strong uptrend, with dips attracting buyers near key averages. On the monthly scale, it holds support at the rising channel's trendline since 2021. The weekly chart shows a rebound from the 50% retracement of the Rs 146-Rs 1,054 move, closing above the 20-week EMA. On the daily scale, a bounce from the 200-EMA and a bullish Sea Pony pattern reinforce strength. Rising volumes and a bullish ratio chart versus NIFTY signal strong investor interest and potential outperformance.
Strategy: Buy
Target: Rs 951
Stop-Loss: Rs 737
Bharat Dynamics | CMP: Rs 1,253.4
Bharat Dynamics maintains a strong bullish structure, forming higher tops and bottoms. On the monthly scale, it has built a base at the 12 and 26-month EMAs. The weekly chart shows a rebound from the 61.8% Fibonacci retracement of the Rs 447-1792 uptrend, reinforcing its bullish stance. On the daily scale, the stock has formed higher bottoms after a five-month correction. RSI is inching higher at 54, signaling improving bullish momentum and positive trend development.
Strategy: Buy
Target: Rs 1,407
Stop-Loss: Rs 1,138
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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