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India unveils its budget on July 23 in the first major policy announcement of Prime Minister Narendra Modi's third five-year term, which could usher in changes to economic priorities.

After a shock election result saw Modi's party returned to power relying on allies, the government is expected to boost consumption in Asia's third-largest economy by lowering personal taxes or increasing spending on consumer-focused areas.

While that could benefit consumer goods makers, real estate and housing finance firms as well as infrastructure and auto companies, some sectors could also stand to lose, said brokerages.

Here are some of their winners and losers.

RURAL-LINKED SECTORS

The government is expected to allocate more funds for rural schemes to stimulate consumption, aiding consumer goods makers like Hindustan Unilever and two-wheeler makers like TVS Motor and Hero MotoCorp, according to Citi.

A less than 5%-7% increase in tobacco taxes could be a positive for ITC, the country's largest cigarette maker, according to Jefferies.

REAL ESTATE

The government is likely to allocate more funds for affordable housing, benefitting developers such as Macrotech Developers and Sunteck Realty, Citi said.

Moreover, the introduction of an interest subsidy scheme for urban housing would boost financiers like Aavas Financiers and Home First Finance, said Jefferies.

AUTOMAKERS

India doled out subsidies worth 115 billion rupees ($1.38 billion) over five years to drive the adoption of electric vehicles (EVs) and Macquarie expects the government to retain both the quantum and tenure in its latest scheme.

That could benefit Tata Motors, India's top e-car maker, as well as IPO-bound e-scooter maker Ola Electric and e-bus makers Olectra Greentech and JBM Auto.

Conversely, lesser-than-expected EV subsidies could benefit Maruti Suzuki, India's highest-selling car maker and one that has chosen to make hybrid cars over pure EVs.

MANUFACTURING

The push on production-linked incentive schemes, which incentivises local manufacturing and creates jobs, is expected to continue, according to HSBC.

That will help manufacturers of technology hardware, telecom equipment, electronics and medical devices among others, like Dixon Technologies, Ideaforge Technology, Biocon.

Capital goods companies like Larsen & Toubro and infrastructure firms could benefit from the likely rise in capital expenditure in the budget, according to Jefferies.

TRADING

Any change in capital gains tax -- either by raising the holding period or tax rate -- could be a dampener for equities, Morgan Stanley said, though it says such moves are unlikely.

But, if enacted, they would increase the tax burden on equity and mutual fund investors, eroding the tax advantage they enjoy over investors in other asset classes.

It could also lead to lower trading volumes, weighing on brokerages Motilal Oswal, ICICI Securities, Angel One, 5 Paisa among others.

The country's mutual fund association has petitioned that mutual fund units be exempted from long-term capital gains tax.

The government and regulators also want to rein derivatives trading -- which has largely powered the stock market's rally since the COVID-19 pandemic -- calling it risky and speculative.

Any move to do so, such as through higher taxes, will not only weigh on the market but also reduce trading volumes and in turn, affect brokerages and trading platforms, Jefferies said.