Anand Rathi Securities has come out with its report on Budget FY12-Preview. According to the research firm, overall expectations from the budget are modestly positive for almost all sectors except Autos. Despite concerns regarding likely increase in fiscal deficit in FY12, we expect cash balance transfer from FY11 to FY12 to improve the fiscal situation substantially.
Passive fiscal consolidation to continue: Fiscal consolidation to continue: FY12 budget is not likely to see any one-off revenue bonanza as in FY11. On our assumption of 16.5% growth in tax revenue and 9.6% growth in total expenditure, we estimate the fiscal deficit at 4.5% in FY12. Market borrowing to be low: In FY12, net market borrowing is likely to be Rs 3.5trn. However, the carrying forward, from FY11 to FY12, of a substantial cash balance (~Rs 700bn) would substantially reduce the need for market borrowing in FY12. Emphasis on agriculture: The major focus is likely to be on agriculture, with special emphasis on improving productivity through greater investment, technology use and innovation. Modestly positive for most sectors: While most sectorsDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
