Consumer durables surge on Budget announcements by FM Sitharaman

There already exists a PLI scheme for white goods, with the government committing Rs 6,962 crore in investment to 66 beneficiaries under the PLIWG.

Consumer durables shares jumped as Finance Minister Nirmala Sitharaman announced significant measures to boost rural demand, consumer spending and economic growth.

Titan, ITC, Adani Ports, NTPC and HCL Tech were among the top gainers in the Nifty Consumer Durables index, which itself was up around 2 percent.

The budget has focused on helping the middle class by providing tax relief, including a higher standard deduction for salaried individuals and additional benefits under the new tax regime. This in turn, will boost consumer purchasing power as individuals have more cash in hand.

The government's plan to provide 3 crore more houses under the PM Aawas Yojana is expected to boost demand for basic large consumer durables. Efforts are also being made to make it easier to do business in the manufacturing sector.

New employment incentives across various sectors will encourage workforce growth and support the Make in India initiative, complementing the existing PLI schemes.

Ahead of the budget, experts said that simplified compliance, a focus on R&D, and efficient supply chain management are crucial for the success of the consumer durables sector.

Any changes in the GST structure were also poised to benefit the sector. Some key benefits for the sector would be reducing import duties on components, such as compressors or semiconductors, according to Elara Securities. This in turn, would bring down production costs and make the final goods cheaper to the end consumers and boost demand.

There already exists a PLI scheme for white goods, with the government committing Rs 6,962 crore in investment to 66 beneficiaries under the PLIWG. The government could potentially look at covering additional consumer durables, apart from ACs and LED lights, under a new scheme. This could create new jobs, manufacturing units and increased logistics, said Balasubramanian A, TeamLease Services.