Budget 2026 – Winners & Losers

1 Feb 2026 , 08:18 PM

The Union Budget 2026 reinforced fiscal discipline and sustained India’s investment-led growth strategy, with a fiscal deficit target of 4.3% of GDP, capex rising to ₹12.2 lakh crore, and a focus on high-quality, sector-diversified infrastructure spending that included semiconductors, electronics, and pharmaceuticals alongside traditional roads and railways. While the Budget signalled long-term productivity and industrial diversification, equity markets reacted negatively due to higher STT on futures and options and the reclassification of buyback proceeds as capital gains, which raised trading costs and reduced corporate flexibility, particularly affecting derivatives participants, brokerages, and large-cap corporates. The lack of new liquidity or foreign flow incentives further weighed on sentiment, leading Nifty to decline despite the macro fundamentals remaining broadly intact.

Following are the key winners and losers

Data Center Stocks – Significant Positive

The Union Budget 2026 introduces a tax holiday until 2047 for foreign cloud and data service providers that deliver services globally using India‑based data centres, significantly lowering the effective tax burden on future profits and improving long‑term project IRRs for capital‑intensive builds. This policy, paired with a 15% safe‑harbour cost regime, aims to attract hyperscale cloud investments, accelerate capacity expansion, and strengthen India’s position as a global digital infrastructure hub. A diverse range of data center focused firms benefit:

• Data centre parks & real estate players like Anant Raj Industries etc.
• Cloud services & infrastructure providers like E2E Networks, Netweb Technologies, Orient Technologies etc.
• Construction & power infra support providers like Techno Electric & Engineering, Cummins India etc.

Indian IT Services – Mild Positive

Government raised the safe harbour threshold for IT services from ₹ 300 cr to ₹ 2000 cr and introduced a uniform ~15% margin, reducing tax and transfer pricing uncertainty for large and mid-tier firms. Proposals to fast-track Advance Pricing Agreements (APAs) further improved cash flow visibility. While the measures are mildly positive, they reinforce predictable margins and compliance certainty.

EMS Firms – Positive

Outlay for Electronics Component Manufacturing Scheme (ECMS)has been increased to ₹ 40,000 crore, aiming to boost local production of components, semiconductors, and high-value electronics and attract long-term capex into India’s EMS ecosystem. EMS players like Amber, Kaynes, Syrma SGS, Dixon etc. continue to be beneficiaries of this.

PSU Banks – Negative

The Budget 2026 set a record government borrowing of ₹ 17.2 lakh crore for FY27, raising concerns over higher bond yields. Given the high government bond holdings of PSU banks, this would result in material MTM losses for the PSU banks. As a result, PSU banks corrected sharply during the day.

FMCG – Negative

The Budget 2026 increased excise duties on tobacco and doubled the TCS rate on alcoholic liquor, hitting volumes and margins. ITC Ltd saw its stock decline as markets priced in near-term margin pressures. The absence of any major personal tax relief or GST reforms limited upside for broader FMCG demand.

Exchange and Brokerage Stocks – Significant Negative

The Union Budget 2026 sharply raised STT on equity derivatives, with futures up from 0.02% to 0.05% (+150%) and options premiums from 0.10% to 0.15% (+50%), effective 1 April 2026. Given that derivatives account for a significant portion of brokerage revenues and exchange trading volume, the impact was significantly negative for capital market stocks like brokerages and exchanges. Absent offsetting measures to boost participation, near‑term earnings growth for brokers and exchanges is likely subdued.

Shipping & Logistics – Significant Positive

In addition to a 9% higher capex, there was a targeted push into freight, waterways and ports, directly benefiting shipping and logistics names. Key measures include new Dedicated Freight Corridors, operationalisation of 20 national waterways, a Coastal Cargo Promotion Scheme to lift inland and coastal shipping’s share of freight, and a ~48% higher outlay (~₹5,165 cr) for the ports, shipping & waterways ministry, all of which reduce logistics costs and expand cargo capacity. This was a significant positive for shipping and related stocks including Container Corp, Dredging Corp, Essar Shipping etc.