Finance minister Piyush Goyal presented an interim budget stuffed with largesse targeted at the salaried middle class and rural poor, in what is being seen as an exercise clearly aimed at wooing these sections ahead of the general elections due in May.

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The income tax exemption limit for the salaried middle class has been raised to Rs 5 lakh for 2019-20. The government will launch a social security coverage for workers in the unorganised sector and - vulnerable farmers will receive Rs 6,000 rupees a year from December 2018 under a new scheme titled PM Kisaan Samman Nidhi.

Navneet Munot, CIO, SBI MF; Gautam Duggad, head-research, institutional equities at Motilal Oswal Financial Services and Gautam Chhaochharia, MD and head-India research at UBS Securities spoke at length about the road ahead for the stock market in general and sectors that will advantage in particular.

On the budget, Munot said, “People have been saying that this is a big boost for consumption. Yes. There is more money in the pocket of every segment of the society whether it is middle-class or the farmers.”

“However, also keep in mind the valuations of all the sectors. There could be pockets of consumers; I would say in the discretionary space, not only in the autos but also in home improvement etc... where there could be some value but just extrapolating that this is a consumption-oriented budget and everything in consumption should go up. It is negative for industrials, its negative for investments – I do not agree with that,” Munnot added.

On sectors front, Duggad said, “One can debate about valuations but till the time revival is seen in earnings in the non-consumption part of the market, the sectors which are already doing well on earnings front whether its consumption, private corporate banks and IT and that view will continue for us as far as CY19 is concerned. Of course, after the election, we will take a fresh card depending on the political outcome.”

Chhaochharia said the market was expecting rural boost and consumption boost. Therefore, it’s debatable whether these numbers are underwhelming or overwhelming versus those expectations.

“In our view consumption doesn’t drive growth recovery. You need capital formation or capex driven growth recovery. So in that sense, this budget is tad disappointing but yes, near term it will drive the bipolar market further,” he added.