The Interim Budget 2024 largely turned out to be a non-event for the stock markets. Sensex (71,645) and Nifty 50 (21,697) closed the day marginally lower by 0.15 per cent and 0.13 per cent respectively.

However, among the sectors, the public sector banks (PSB) and housing finance stocks seem to have benefited from this Budget. The Nifty PSU Bank index surged over 3 per cent.

Lowering the fiscal deficit and borrowing estimates gave a boost for PSU banks. According to reports, the PSU banks hold a higher part of government bonds compared with private banks. The Indian 10Yr bond yield tumbled from 7.14 per cent on Wednesday to close at 7.06 per cent on Thursday. Amit Goel, Co-Founder and Chief Global Strategist, Pace 360, says, “The Indian 10Yr yield is expected to come down to 6.5 per cent by this year-end and this will be a big positive for PSU banks.”

Announcement to build two crore houses in the next five years under the PM Awas Yojana (Grameen) and a plan to launch a scheme for housing lifted the housing finance stocks. Housing & Urban Development Corporation (HUDCO), Repco Home Finance and GIC Housing Finance gained the most following the announcement.

Considering the above-mentioned themes, we have picked two stocks from each segment that look attractive on the charts for long-term investors.

Union Bank of India (₹144.60): The stock has been in an uptrend since 2021. There is an inverted head and shoulder bullish pattern formed between 2018 and 2023. Strong support is around ₹120. The stock can target ₹175-180 in the next couple of quarters and ₹220-250 in a year or two. This bullish outlook will go wrong only if the stock declines below ₹120. But that looks unlikely.

Indian Overseas Bank (₹52.09): The long-term downtrend in this stock that was in place since 2010 has been reversed recently with a rounding bottom base formation. Strong support now at ₹37. Indian Overseas Bank share price can target ₹90 over the next one year. Intermediate resistance is around ₹70, from where a short-lived correction is possible before the price targets ₹90 on the upside.

Repco Home Finance (₹453.5): Repco Home Finance stock, since the beginning of this week, was appreciating after finding support at ₹395. The upswing got a boost on Budget day and saw a strong rally accompanied by substantial volumes. Notably, it surpassed a barrier at ₹440 and hit a fresh high of ₹463.45. Given the momentum, we expect the stock to rally past the resistance at ₹460 and scale new heights in the coming weeks. Repco’s stock shows potential to touch ₹550 over the next few months. But there could be a minor correction, possibly to ₹430, before the stock embarks on a journey towards ₹550.

GIC Housing Finance (₹279.2): The stock of GIC Housing Finance bounced off the support at ₹252 on Thursday. It crossed over the resistance at ₹265 and marked a record high of ₹286.6 before closing the session lower at ₹279.20. The breakout occurred with considerable volumes, increasing the odds of further appreciation in price. The stock can target ₹350 in the medium term, however with intermediate corrections.

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