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New Delhi: Shares of telecom infrastructure companies on Tuesday declined more than 4 per cent after Finance Minister Nirmala Sitharaman said the government will increase the basic customs duty on specified telecom equipment from 10 per cent to 15 per cent.
On the BSE, shares of HFCL tumbled 4.60 per cent to Rs 112.10 apiece, Vodafone Idea plunged 4.15 per cent to Rs 15.23, Tejas Networks slumped 2.69 per cent to Rs 1,278.95, and ITI declined 2.58 per cent to Rs 295.10.
The scrip of Bharti Airtel fell 1.50 per cent to trade at Rs 1,442.70 per piece, ADC India Communications slipped 2.14 per cent to Rs 1,771.95, and Tata Communications dipped 0.97 per cent to trade at Rs 1,768.95 on the bourse.
However, shares of Kavveri Telecom jumped 1.96 per cent, Shyam Telecom rose 1.95 per cent, and Indus Towers gained 0.42 per cent on the BSE.
In the mid-session trade, the 30-share BSE Sensex plunged 497.22 points or 0.62 per cent to 80,004.86.
The government has proposed to increase import duty on motherboards, technically called printed circuit boards, by 5 per cent in the Union Budget 2024-25 to boost domestic telecom gear manufacturing.
"To incentivise domestic manufacturing, I propose to increase the BCD (Basic Customs Duty) from 10 to 15 per cent on PCBA (printed circuit board assembly) of specified telecom equipment," Sitharaman said.
The increase in basic customs duty for telecom PCB assembly comes with the exemption of critical minerals that are used in the manufacturing of communication equipment.
The finance minister proposed to fully exempt 25 minerals, such as lithium, copper, cobalt and rare earth elements, which are critical for sectors like nuclear energy, renewable energy, space, defence, telecommunications, and high-tech electronics from customs duties and reduce basic customs duty on two of them.
"This will provide a major fillip to the processing and refining of such minerals and help secure their availability for these strategic and important sectors," Sitharaman said.
Meanwhile, the stock of Dixon Technologies slumped 4 per cent to trade at Rs 10,900 apiece after Sitharaman proposed slashing import duty on mobile phones, chargers and some components that are used for manufacturing of handsets in the Union Budget.
The stock of Syrma SGS Technology also declined 1.97 per cent to trade at Rs 461.40 on the exchange.
Union Budget 2024 LIVE | Making a record for any Finance Minister, Nirmala Sitharaman presented her 7th consecutive Union Budget on July 23, 2024 under the Modi 3.0 government. This Budget brought tax relief for the middle class, while focusing on jobs through skilling, incentivising employers. Track the latest coverage, live news, in-depth opinions, and analysis only on Deccan Herald. Also follow us on WhatsApp, LinkedIn, X, Facebook, YouTube, and Instagram.