As India’s Union Budget 2026 approaches, investors are closely watching market themes that could shape stock performance. Analysts expect Finance Minister Nirmala Sitharaman to maintain fiscal prudence while accelerating public spending on key sectors such as infrastructure, defence, power and housing. With this outlook, brokers are recommending a “buy-on-dips” approach — focusing on quality stocks that are likely to benefit from government spending and policy continuity rather than short-term speculative moves.
Market participants broadly see three core themes emerging from pre-Budget expectations. The first is continued public capital expenditure to sustain economic momentum, with major engineering and construction names likely to benefit. The second is defence modernisation and railway upgrades, where indigenisation and safety-focused investments could offer structural growth. Finally, there is a clear thrust on power and renewables, alongside support for the housing sector through welfare-linked spending.
In the capex and infrastructure space, stocks like Larsen & Toubro, Siemens and KEC International are seen as key plays, given strong order pipelines and improved execution visibility. Ultratech Cement also features as a key pick, positioned to benefit from a combination of infrastructure and housing demand.
Within defence and railways, analysts highlight Hindustan Aeronautics Ltd, Bharat Electronics Ltd and Bharat Dynamics Ltd as core ideas, supported by ongoing policy focus on Make in India, R&D and capacity upgrades in naval, air and ground systems.
The power and renewables segment includes picks like NTPC and Tata Power, which are viewed as well-placed to capitalise on higher allocations for transmission, grid modernisation and clean energy initiatives. These integrated utilities are expected to gain from the shift towards renewable generation and a more resilient grid.
On the housing and real estate front, Godrej Properties and Brigade Enterprises are identified as structural beneficiaries of both public spending and welfare-oriented schemes such as PMAY, especially if there is incremental support for affordable and mid-income housing segments.
Rather than chasing intraday volatility on Budget Day itself, brokers like Bajaj Broking, Motilal Oswal and Axis Direct advise investors to accumulate quality, policy-aligned stocks on dips, positioning for sustained growth once budget clarity emerges. This buy-on-dips strategy is aimed at capturing opportunities from temporary weaknesses in fundamentally strong sectors that are expected to benefit from government priorities.
