Consumer durables shares jumped as Finance Minister Nirmala Sitharaman, during her Union Budget 2025 speech, announced that no income tax will be payable on income up to Rs 12 lakh, providing significant relief to taxpayers. She also stated that the new income tax regime will be simpler, with a special focus on benefiting the middle class.
Finance Minister Nirmala Sitharaman no income tax will be levied on income of Rs 12 lakh. This measures will boost consumption in the Union Budget 2025, as lower taxes will boost household income, which in turn raise the demand for consumer staple products."
Whirlpool of India, Blue Star, Kalyan Jewellers were among the top gainers in the Nifty Consumer Durables index, which itself was up around 1.2 percent at 12.25 pm.
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Consumer durables stocks have seen a bumpy ride on the bourses over the past few months, as urban demand softened. Falling consumption has weighed on corporate earnings with the near-term outlook turning cloudy as buyers turn thrifty, pinching their pockets as liquidity in the system dries up and inflation weighs heavy. Investors and market experts are pencilling in measures for the upcoming Union Budget to revive the depressed sector.
Market experts had emphasised that the Budget should prioritise simplifying income tax structures in a manner that could increase disposable incomes, besides enhancing rural infrastructure, and expanding direct benefit transfer programs. These measures could help revive consumer spending, particularly in the Consumer Durables sector.
On the corporate side, from import reductions, extension of PLI schemes, and boosting domestic manufacturing, industry players were confident that the central government would include policies to boost demand for the sector.
In a report before the Budget, Bank of America Securities wrote, “The government would want to press the pedal on extending the PLI schemes that have performed well and introduce new incentives on this front. A PLI of Rs 25,000 crore for electronic components manufacturing is also likely to be announced.”
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