**Market Brief: Tourism Stocks Defy Budget Sell-Off** **Date:** February 1, 2026 **Event:** Union Budget 2026-27 Reaction **Snapshot** Tourism and hospitality stocks emerged as a rare bright spot today, surging against a broader market crash. While the Sensex plunged ~1,500 points following a hike in Securities Transaction Tax (STT) on F&O, travel counters rallied on sector-specific stimulants. **Key Drivers** * **TCS Rationalization:** A major boost for outbound travel—Tax Collected at Source (TCS) on overseas tour packages slashed to a uniform **2%** (down from higher slabs), aimed at lowering upfront costs for travelers. * **Medical & Skilling Push:** Announcement of **5 regional medical tourism hubs** and a new **National Institute of Hospitality** to bridge the skills gap. * **Infrastructure:** Development of an integrated **East Coast tourism corridor** and Buddhist circuits in the North East. **Sector Performance** * **Easy Trip Planners:** The day's standout gainer, surging **9–11%**. The stock reacted sharply to the TCS cut, which directly aids volume growth for international bookings. * **Lemon Tree Hotels:** Jumped **~6%**, outperforming peers as mid-segment demand remains robust. * **Premium Hospitality:** **Indian Hotels** (+1%), **EIH** (+2%), and **ITC Hotels** (+1%) held firm in green territory, supported by the long-term infrastructure narrative. * **Contrasting Moves:** **ITC Ltd** (parent entity) faced pressure, dropping **~3-4%** to 52-week lows due to a statutory hike in cigarette taxes and NCCD rates. **Thomas Cook** saw minor profit-booking (-2%) despite favorable policy. **Outlook** The Budget’s multi-pronged approach—combining immediate tax relief (TCS cut) with long-term capacity building (medical hubs, skilling)—signals sustained government support. While the broader market digests the STT shock, the hospitality sector appears positioned for a structural upcycle driven by domestic infrastructure and revived outbound demand.