The Union Budget 2026 is expected to bring targeted sectoral allocations, policy reforms, and capital expenditure boosts across defence, railways, NBFC-MFI, fertilisers, affordable housing, precious metals, and export-oriented sectors.

Based on JM Financial Services research, here’s a detailed breakdown of potential Budget 2026 stock opportunities.

1️) Defence Sector – Higher Capital Allocation in Focus

Budget 2026 may see increased capital expenditure, R&D allocation, and stronger focus on UAVs, drones, and anti-drone systems.

Defence Stocks in Focus:

• Hindustan Aeronautics Ltd (HAL)

• Bharat Electronics Ltd (BEL)
• Bharat Dynamics Ltd (BDL)

Why Defence Could Benefit:

• Higher defence budget allocation
• Make in India push
• Export opportunity for defence equipment
• Government focus on indigenous manufacturing

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2️) Railways – Capacity & Safety Push

After muted growth, Budget 2026 is expected to increase allocation toward railway infrastructure, capacity augmentation, and safety systems like Kavach.

Railway Stocks in Focus:

• Rail Vikas Nigam Ltd (RVNL)

• RITES Ltd
• Titagarh Rail Systems Ltd
• Kernex Microsystems (India) Ltd

Railway Investment Themes:

• Railway capex increase
• Railway electrification
• Safety modernization
• Rolling stock expansion

 

3️) NBFC – MFI (Microfinance) Sector

A potential credit guarantee scheme for NBFC-MFIs may help them raise funds and lend to low-income borrowers.

NBFC-MFI Stocks in Focus:

• CreditAccess Grameen Ltd

• Fusion Finance Ltd

Growth Drivers:

• Rural lending growth
• Financial inclusion push
• Government-backed credit guarantees

4️) Fertilisers – Subsidy Support

Budget 2026 may see higher fertiliser subsidy allocation (₹1.7–₹2.0 trillion) due to elevated raw material prices.

Fertiliser Stocks in Focus:

• Coromandel International Ltd

• Deepak Fertilisers & Petrochemicals Corporation Ltd

Tailwinds:

• Agriculture sector support
• Raw material cost compensation
• Strong rural demand

5️) Affordable Housing – GST Redefinition

Redefinition of affordable housing (price/size) may attract lower 1% GST rates and stimulate housing demand.

Housing Finance Stocks in Focus:

• Aptus Value Housing Finance India Ltd

• Home First Finance Company India Ltd

Potential Triggers:

• GST benefits
• PMAY scheme support
• Housing demand recovery

 

6️) Precious Metals – Import Duty Changes

Possible import duty revisions on precious metals may impact bullion and related companies.

Precious Metal Stocks in Focus:

• Hindustan Zinc Ltd

• Muthoot Finance Ltd

Impact Themes:

• Gold and silver import policy
• Bullion demand
• Precious metal financing

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7️) Other Export-Oriented Sectors

Potential incentives for exporters in textiles, engineering, auto ancillary, and chemicals.

Stocks in Focus:

• Welspun Living Ltd
• Bharat Forge Ltd

Themes:

• Tariff protection
• Export incentives
• Manufacturing growth

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