AMIT NALIN SECURITIES PVT. LTD.

BUDGET FY2012-13

Automobiles: In the Budget for FY2013, government has raised the excise duty on automobile by 2% to 12%. For the large cars, the excise rate has been increased from 22% to 27%; additional Rs 15000 for vehicle of more than 1500cc engine. The most anticipated- separate tax for diesel vehicle, was not implemented. Companies impacted: M&M, Tata Motors, Ashok Leyland, Eicher Motors, Maruti Suzuki, Hero MotoCorp, Bajaj Auto, TVS. Banking & Finance Interest on saving bank account upto Rs 10000 has been made tax free. Government implemented Rajiv Gandhi Equity Scheme under which retail investor will get 50% tax reduction for investment upto Rs 50000. Power finance companies are allowed to raised money through issue of tax free bond upto Rs 10000 crore. Companies Impacted: PSU and Private Banks, REC, PFC Cement: Excise duty on cement has been raised from 10% to 12%, while the ad valorem tax has been reduced from Rs 120/tonne to Rs 100/tonne. Import duty of 5% on imported coal has been exempted till 2014. Railway Freights has been in the railway budget. Companies Impacted: ACC, Ambuja, Ultratech, Shree Cement, JP Associate, Birla Corp., India Cement, Madras Cement, and Managalam Cement. Consumers Excise and Service tax increased by 2% each, from 10% to 12%. Introduction of 10% ad valorem duty on 50% of MRP of cigarettes. Tax collection at source for purchase of bullions or jewelry of more than Rs 2lakh

has been introduced. Custom duty on standard gold bars, coins, and platinum has been increased from 2% to 4%. Companies Impacted: ITC, Gitanjali Gems, Oil Cess on crude has been increased from Rs 2500/ tonne to Rs 4500/ tonne. Oil Subsidy has been raised upward. Companies Impacted: ONGC, Oil India, GAIL, HPCL, BPCL, and IOC.

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AMIT NALIN SECURITIES PVT. LTD.

BUDGET FY2012-13

Infrastructure Limit for the tax free infrastructure bond has been doubled from Rs 30000 crore to Rs 60000 crore. Defence and rural allocation have been increased by 20% to Rs 79500 crore and 30% to Rs 637 crore. Custom duty on purchase of equipment for coal mining and road construction has been reduced. Companies Impacted: L&T, Thermax, BHEL, BEL, and Sintex.

Metals Custom duty on flat rolled products of non-alloy has been increased from 5% to 7.5%. Import duty of 5% on coal for thermal power has been exempted. Excise duty increased from 10% to 12%. Companies Impacted: Tata Steel, JSW, Bhushan Steel, and SAIL. Aviation Budget has introduced a proposal under which airline companies can raise working capital upto $1bn through ECB route and direct import of jet fuels. The proposal for 49% FDI in aviation sector is also under consideration. Companies Impacted: Jet Airways, Spice, and KFA. Fertilizers Government has allocated subsidy of Rs 61000 crore for fertiliser sector against Rs 49997 crore in the previous year budget. Urea price has not been changed and government is planning to bring urea under the NBS policy. Government has made significant progress in the UID program under which the subsidy would be directly transferred to the end users. This should bring down the working capital on the fertilizer companies. Companies Impacted: Chambal, Tata Chemicals, Coromandel, GSFC, NFL, FACT, RCF and Mangalore fertilizer. Power Custom duty on imported coal has been fully exempted. Government has also advised Coal India to sign fuel supply agreement with power producers that have entered into long term power purchase agreement with power distribution companies. Power companies are also allowed to raise foreign currency debt which would bring down their cost of debt. Companies Impacted: NTPC, NHPC, JSW energy, Adani Power, and Lanco Infratech.

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AMIT NALIN SECURITIES PVT. LTD. AMIT NALIN SECURITIES PVT. LTD. BUDGET FY2012-13
BUDGET FY2012-13

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