Moneycontrol Budget Sensitivity index (MCBudEx) closed 0.43 percent lower on February 2, as shares of Adani Ports, Coromandel International and Titagarh Wagons dragged it down. ITC, the top gainer on the index, was the saving grace.
ITC took a sharp beating on the Budget day initially on the hike in the National Calamity Contingent (NCCD) duty but recovered swiftly to close in the green. The rally continued on February 2, with the stock hitting an all-time high of Rs 384.70, inching closer to the Rs 400 mark.
The rally ensued after the Street realised that the 16 percent hike in NCCD would mean only a 1-2 percent hike in the overall tax on a cigarette stick. NCCD forms about 10 percent of the overall tax.
Also Read: ITC nears Rs 400 mark; why costlier cigarettes are great news for shareholders
After the Board's decision to withdraw Adani Enterprises' fully-subscribed follow-on public offer (FPO), the group stocks plunged further. While Adani Enterprises fell over 25 percent, Adani Ports closed 7 percent lower at Rs 459.50.
The withdrawal of FPO raised funding concerns but group chairman Gautam Adani assuaged them by saying, "We will continue to focus on long-term value creation and growth will be managed by internal accruals. Our EBIDTA levels and cash flows have been very strong and we have an impeccable track record of fulfilling our debt obligations."
Also Read: RBI looking at banks' exposure to Adani group companies, seeks present status: Sources
Coromandel International was another big loser on the MC BudEx. Fertiliser stocks have slipped after Finance Minister Nirmala Sitharaman set aside Rs 1.75 lakh crore for fertiliser subsidies for the financial year 2023-24, which is 22 percent lower than Rs 2.25 lakh crore for FY23.
The stock closed 2.5 percent lower at Rs 878 apiece on the NSE.
MC BudEx is an equal-weight index that captures how expectations from the Budget get priced into the stock market. The index constituents have been picked after conversations with dozens of stock-market participants, and after back-testing data for the past seven years to see which segments of stocks were most sensitive to the budget relative to the rest of the market.
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