Infrastructure is unlikely to see the budgetary support that the market is expecting, said Aditya Narain, head of Research, institutional equities at Edelweiss, adding that the upcoming Union Budget could be 'neutral' to slightly positive for the sector.
“I don't think infrastructure will get that extra leg up that everyone presumes, for the simple reason that a fair amount has been put into infrastructure and it has not provided the same kind of delta,” he said, in an interview with CNBC-TV18.
Speaking about infra expenditure, Narain said, “What has changed between 6 months ago and now is the fact that you were at the point of time looking at growth acceleration in the economy, and now you are looking at growth revival. To that extent, because it is a riskier environment, because it is more challenging from a funding perspective, we would fundamentally stay defensive on our portfolio.”
“Infrastructure will probably get a lesser share in the expansion... I think because you have policy support towards lower rates, I would tend to believe, infrastructure would be neutral to slightly positive,” he added.
Talking about the fiscal deficit, Narain said, “I think the government needs to come in and be a little bit more aggressive with this fiscal deficit. I think everyone is looking for 3.4 but you actually need a stimulus and you need that number to actually go up. So the pie actually has to expand in terms of the money that is effectively put into this system.”