Budget 2025: Stocks that should be on your radar during the FM speech

The government is also likely to reiterate its thrust on clean energy with emphasis on renewables, battery storage adoption, small nuclear reactors, pumped storage projects and work on a roadmap for hard to abate industries, according to Morgan Stanley. Jefferies said that any change in the import duty structure on modules and cells will be key to watch out for. Within the power generation space, keep an eye on NTPC, Tata Power, JSW Energy, NHPC, SJVN, CESC, along with Adani Power, Adani Energy solutions, and KP Energy. Within the renewable energy stack, watch for Tata Power, NHPC, Suzlon, Waaree Renewables, Sterling & Wilson and Premier Energies. Among the transmission pack, watch for Power Grid, Indigrid INVIT and Power Grid INVIT.

An increase in healthcare infrastructure in the rural and semi-urban regions is also a possibility. A potential support for higher R&D through tax deduction will be positive for the entire Pharma sector. A PLI for anti-diabetic and weight-loss medication will be positive for Sun Pharma, Cipla, Dr. Reddy’s and Biocon.

A further enhancement in the Ayushman Bharat scheme by increasing the budget allocation to expand the list of treatment will be negative for hospitals as they may be forced to treat patients at lower prices. Keep an eye on Apollo Hospitals, Max Health, Aster DM Healthcare, KIMS and Jupiter.

A reduction in customs duties on life-saving drugs will be positive for the sector overall. Medical device companies expect standardization of GST rates at 12% across devices and an enhanced export incentive will be positive for device makers like Poly Medicure.

Any potential announcement for low-cost financing through tax incentives for both existing and new medical tourism projects will be positive for hospital stocks like Apollo, Max Health, Aster DM, KIMS and Jupiter.

Any potential announcement on affordable housing, relaunch of subsidy schemes like CLSS under PMAY to improve affordability will be beneficial for stocks like Aadhar Housing Finance, Aptus Value, Aavas Financiers, Home First Finance,

Any potential rise in the deduction limit for home loan interest and principal and reduction in GST rates for construction materials, particularly cement, to enhance overall affordability will benefit the entire basket of builders from Godrej Properties, to DLF, Prestige Estates, Macrotech and others.

A higher capex allocation for the railways will be positive for the entire sector. Announcement for new Vande Bharat trains will be positive for stocks like RVNL, Jupiter Wagons, Titagarh, RITES and BEML. A higher focus on KAVACH will be positive for HBL Power, Kernex Micro, KEC International, RailTel and Siemens. A roadmap for higher rolling stock procurement will benefit stocks like Texmaco and Titagarh.

Rural income incentives, measures to contain inflation and taxation on tobacco will be key to watch in the Budget. Announcement of schemes in poll-bound states will boost consumption, keeping stocks like Dabur, Emami, HUL and Britannia in focus. Any potential tax sops to the middle class will aid companies like Nestle, which has a higher share of urban revenue.

Announcements on initiatives like Housing For All and a higher allocation for Smart Cities will be positive for paint companies as well as stocks like Pidilite.

An enhanced focus and continued support for existing guaranteed schemes for MSME and Small businesses will keep SBI, PNB, HDFC Bank, ICICI Bank, Bajaj Finance and L&T Finance in focus.

An increased allocation for Housing Schemes will keep PNB Housing, LIC Housing, Aavas Housing, Aadhaar Housing, and Home First Finance in focus.

An increased budgetary allocation for the agri sector will benefit stocks like Shriram Finance, L&T Finance, Mahindra & Mahindra Finance. Measures to boost rural income will also benefit these NBFCs.

Announcements related to power capex will benefit names like REC, PFC and IREDA, the power sector financiers.

A separate income tax deduction window outside 80C for life insurance premium will be positive for HDFC Life, SBI Life, ICICI Prudential Life and Max Financial.

A higher income tax deduction window under 80D for Health Insurance Premiums for Senior Citizens will be positive for ICICI Lombard, Star Health Insurance and New India Assurance.

A push to incentivise the new income tax regime could also be negative for both health and life insurers as it does not provide any exemption for life or health insurance premiums. Currently, 80C exemptions form nearly 5% of the Life Insurance Industry’s premium.

In case the Insurance Amendment Act is announced, where FDI in Insurance is increased to 100% will be positive for the entire sector. In case a Composite Insurance License is announced will also be positive for all. Allowing merger or amalgamation of insurers with non-insurers will be positive for Max Financial and a change in investment regulations for insurers will be positive for all insurers.

For the auto sector, any potential direct incentives or schemes for building an EV supply chain will benefit stocks like Exide and Amara Raja.

Any announcements on charging infrastructure and energy storage systems will be positive for Bajaj Auto, TVS Motor, Ola Electric, Tata Motors, M&M and JBM Auto.

Any increase in allocation for rural development schemes will be positive for M&M, Bajaj Auto, Hero MotoCorp and Escorts Kubota, while any change in tax structures will be positive for the entire industry.

For the oil & gas space, excise duty is levied at 14.4% on an ad-valorem basis on CNG. The quantum amounts to around ₹9.5 per kg in the CNG price. Any reduction in this excise duty will benefit IGL, MGL and Gujarat Gas.

PSU oil marketing companies have incurred under-recoveries for a better part of 2024. By the end of the first nine months of 2025 is in excess of ₹29,000 crore. Any increased allocation of subsidy will be positive for Indian Oil, HPCL and BPCL.

Although the government has revoked the Windfall tax, with crude back near $80 per barrel, any reimposition of the Windfall tax will be negative for upstream oil companies like ONGC, Oil India, HOEC.

Brokerage firm Elara Securities expects the Defence budget to rise by 7-8%, reaching ₹1.9 lakh crore. Most of the defence capex is likely to be towards higher allocation for aircraft & engines, naval fleet and other equipment. More schemes to boost defence budget will be beneficial for companies like Hindustan Aeronautics, Bharat Electronics, Bharat Dynamics and Solar Industries.

Any changes in schemes to attract more startups, tech advancements etc. will keep stocks like IdeaForge and Zen Tech in focus. A higher allocation to support indigenisation and defence production will benefit all the companies in the sector.

An increase in allocation to the railway budget will benefit capital goods names like Siemens, ABB and CG Power. The first two will also benefit from allocation to metro projects and a higher PLI allocation.

Any focus on advanced ultra-supercritical power plants, a push to develop small modular reactors and allocation for nuclear power projects will benefit BHEL.