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SAMCO Securities Research Analyst Raj Gaikar on Union Budget
This story was originally published at 13:09 IST on 1 February 2026
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MUMBAI - Raj Gaikar, research analyst, SAMCO Securities, said the following on the Union Budget for 2026-27 (Apr-Mar), presented in the Lok Sabha by Finance Minister Nirmala Sitharaman on Sunday:
The Finance Minister's proposal to raise STT (securities transaction tax) on futures to 0.05% is structurally negative for the capital market ecosystem, particularly F&O-driven businesses. Higher transaction costs are likely to reduce trading volumes, dampen short-term momentum, and lower profitability for active market participants.
FII (foreign institutional investor) participation in derivatives may also moderate as post-tax trading efficiency declines, impacting overall liquidity. This can create a cascading effect on revenue streams of broking companies, exchanges, AMCs (asset management companies), and depositories, which are closely linked to market turnover. With derivatives volumes already shrinking in recent months, the hike may further pressure near-term earnings visibility. While fiscally supportive, the measure poses headwinds for capital-market-linked stocks. End
Compiled by Shumaila Firoz
Filed by Deepshikha Bhardwaj
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