This budget targets to reduce prices essential items. Together with the reduced prices of fuel and gasses and the likely reduction in electricity prices as said by Finance Minister will bring down the inflation further. This will positively affect the businesses in terms of low cost, low interest rates and favorable exchange rates
The proposals to increase revenue will have an impact to some of the sectors but not all as below.
a) Banking & Finance - The largest hit can be expected since most of them earns more than 2bn profit so the super gain tax will reduce this years profit. On top of that the reduced interest rates on credit cards will reduce the margins from this business but there can be a huge volume increase.
Counters to look for bargain prices are COMB, HNB, NDB, DFCC, NTB, SAMP, CFIN, COCR, CINS, LFIN
b) Food and beverage - The super gain tax will hit the share prices of the following counters
c) Diversified - Super gain tax and casino fee impact
Counters for bargain will be JKH, HAYL, DIST, VONE, SPEN
d) Manufacturing - Super gain tax impact for the counters such as LLUB, TKYO, RCL
e) Power & Energy - Super gain tax impact on LIOC
f) Telecommunication - Super gain tax plus the charge on satellite TV business and the removal of tax on reloads
Both DIAL & SLTL to be impacted
These shares will come down but will recover earlier than expected since these are one off nature. So the opportunity exists to collect at lower prices.
Another important point is that when the overall market comes down due to the big players the small players with sound financials will also come down. You must not let go this opportunity as well. Because when the market recovers these are the once that will come back to their original prices in no time. Some of the counters to watch are SIRA, VPEL, GLAS, GREG, SFIN, VFIN, AAF, BIL, RICH.
This is my analysis and my advice to you. Happy trading.