The extension of PLI benefits for consumer durables companies and increase in customs duty, if any in the Union Budget 2022 will drive domestic manufacturing.
While the PLI scheme commenced from FY22, some companies have not yet been able to complete the required capex and drive growth due to Covid waves in FY22. Hence, we endorse the belief that extension of PLI benefits by 1-2 years will be positive to industry, stated ICICI Securities in a report.
The report said that increase in customs duty on certain inputs may increase India production and any additional levy on imports of raw materials may lead to increase in domestic production.
"We believe initiatives to step up rural consumption (20-30 per cent of durables consumption) will drive further growth, the report said.
