Budget provisions
- Basic customs duty on Organic LED (OLED) TV panels from 10% to Nil.
- Parts, components and accessories (falling under any Chapter) for use in the manufacture of tablet computers and their sub-parts for use in manufacture of parts, components and accessories are being fully exempted from BCD, CVD and SAD.
- SAD reduced for Inputs for use in the manufacture of LED drivers and MCPCB for LED lights, fixtures and LED lamps from 4% to Nil.
- Excise duty structure for mobiles handsets including cellular phones is being changed from 1% without CENVAT credit or 6% with CENVAT credit to 1% without CENVAT credit or 12.5% with CENVAT credit.
- Excise duty structure of 2% without CENVAT credit or 12.5% with CENVAT credit is being prescribed for tablet computers.
- To give a boost to domestic leather footwear industry, the excise duty on footwear with leather uppers and having retail price of more than Rs1000 per pair is being reduced to 6%.
- Tablet computers from 12% to 2% without CENVAT credit or 12.5% with CENVAT credit
- C- Block for Compressor, Over Load Protector (OLP) & Positive thermal co-efficient and Crank Shaft for compressor, for use in the manufacture of Refrigerator compressors.
- Propose to introduce a Gold Monetization Scheme, which will replace both the present Gold Deposit and Gold metal Loan Schemes. The new scheme will allow the depositors of gold to earn interest in their metal accounts and the jewelers to obtain loans in their metal account. Banks/other dealers would also be able to monetize this gold.
- Also develop an alternate financial asset, a Sovereign Gold Bond, as an alternative to purchasing metal gold. The Bonds will carry a fixed rate of interest, and also be redeemable in cash in terms of the face value of the gold, at the time of redemption by the holder of the Bond.
- Commence work on developing an Indian Gold Coin, which will carry the Ashok Chakra on its face. Such an Indian Gold Coin would help reduce the demand for coins minted outside India and also help to recycle the gold available in the country.
Budget impact
Television makers have something to cheer as the Union Budget 2015-16 provided many provisions for LEDs. Tablet computers will also become comparatively cheap as it components and accessories have been exempted various duties. The proposal to develop a sovereign gold bond, to introduce a gold monetization scheme and India made gold coins will all ease the supply of gold in the domestic market.
Stocks to watch
Videocon, Blue Star, Hitachi, MIRC Electronics, BPL, Whirlpool, Gitanjali, Titan Group
Outlook
The Union Budget 2015-16 has provided some relief for the consumer durable industry. The future outlook is expected to be positive for the consumer durable industry backed by the provisions proposed in the budget. Even though the budget has not concentrated on the gems and jewelry sector, gold monetization scheme and India made gold coins will help to reduce the dependence on imports.
