‘Rs 30,000 Benefit’: Jefferies On India Budget 2025 | Image:
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One of the leading brokerage firms, Jefferies released its latest GREED & fear report, in which it cited that the Indian government’s decision in union budget 2025 providing tax relief of Rs 12 lakh on income is bold and positive for the economy.
According to Jefferies, the budget brings important tax benefits for around 35 million taxpayers in India.
“The budget was undoubtedly positive, with income tax cuts benefiting the 35 million Indians who actually pay income tax,” the report by Christopher Wood said on Feb 6.
According to the report, higher tax exemptions will put more money in people’s pockets, boosting market liquidity and fostering economic expansion. Individuals making up to Rs 1.2 million yearly would no longer be subject to income tax under the new tax regime; previously, they were just needed to make Rs 700,000 annually.
Additionally, tax rates have been lowered for individuals making more above Rs 1.2 million. The Union Budget ’s tax relief measures are expected to enhance disposable income, boost consumer spending, and drive economic momentum in the country.
“Jefferies’ India office estimates that the benefits from the tax cuts will be spread across approximately 35m taxpayers in India, implying an average benefit of around Rs 30,000/payer” the report stated.
Jefferies: Tariffs Tantrums Of US
The report showed an outlook over the recent tariffs tantrums by Donald Trump in the US. The report claims Donald Trump’s tariff threats are mainly a negotiation strategy.
“Still, to GREED & fear that the 47th president went ahead with this announcement, without potentially thinking through all the consequences, was precisely because he was exasperated that markets had stopped reacting to his tariff threats” the report highlighted.
Trump declared a 25% duty on Canada and Mexico on Friday night, then on Saturday he signed official executive orders. Investors were taken aback by this, as evidenced by market responses throughout Monday’s European meetings.
“Trump then turned on a dime by delaying on Monday the implementation of tariffs by one month in the case of both Mexico and Canada on the view that he will be able to get the necessary concessions to allow him to project any deal as a win” as per the GREED & fear report.
Trump’s initial decision to announce the tariffs may have been fueled by frustration, as markets had stopped reacting to his threats, assuming they were merely part of his bargaining strategy. This belief was further supported by Treasury Secretary Scott Bessent, who had hinted before the election that the tariffs were part of a larger negotiation plan.
GREED & Fear On Indian Equity
According to Greed & fear, a previous report of Jefferies published on January 30, the worst of the market correction is likely over. The report, titled ‘India Equity Strategy: Expecting a Market Bounce’, notes that the Nifty has fallen 15% in US dollar terms, which is consistent with past corrections over the last decade.
“He noted that at 15% the current correction in the Nifty in US dollar terms is in line with the average corrections over the past decade” the report stated.
Mahesh issued a warning, meanwhile, that future robust inflows into stock mutual funds might not be assured.
