Modi's government, in office for less than two months, said it would raise caps on foreign investment in the defence and insurance sectors, and launch a tax reform to unify India's 29 federal states into a common market.

The following sectors/companies will benefit or be impacted by the budget proposals:

WINNERS:

* Increase in foreign direct investment cap in the insurance sector to 49 percent from 26 percent now will benefit companies such as ICICI Bank Ltd (>> ICICI Bank Ltd), Max India Ltd (>> Max India Limited), Housing Development Finance Corporation Ltd (HDFC) (>> Housing Development Finance Corp Ltd) that have insurance ventures with foreign partners.

* Real estate companies such as DLF Ltd (>> DLF Ltd), Unitech Ltd (>> Unitech Limited), Phoenix Mills Ltd (>> Phoenix Mills Limited), Parsvnath Developers Ltd (>> Parsvnath Developers Limited) will benefit from the proposal to provide incentives for setting up real estate investment trusts.

* Plan to develop 100 smart cities and increase in allocations to support rural housing will help developers and housing finance companies such as HDFC, LIC Housing Finance Ltd (>> LIC Housing Finance Limited) and Dewan Housing Finance Corp Ltd (>> Dewan Housing Finance Corporation Ltd.).

* The proposal to allow manufacturing units to sell products via e-commerce platforms is likely to benefit the local units of foreign retailers such as Nike Inc (>> Nike Inc), Marks and Spencer Group (>> Marks and Spencer Group Plc) and Puma SE (>> Puma AG Rudolf Dassler Sport).

* Insurance and asset management companies will gain from a proposal to increase the tax exemption limit on certain investments to 150,000 rupees from 100,000 rupees per year.

* Companies such as Larsen & Toubro Ltd (>> Larsen & Toubro Limited), IL&FS Transportation Networks Ltd (>> IL&FS Transportation Networks Ltd) and IRB Infrastructure Developers Ltd (>> Irb Infrastructure Developers Ltd) will benefit from plans to increase spending to build roads and ports.

LOSERS:

* A proposal to increase excise duty on cigarettes is negative for companies such as ITC Ltd (>> ITC Limited) and VST Industries Ltd (>> VST Industries Limited). Cigarette makers usually pass on any tax hikes to consumers, which may impact sales.

* A more than $2 billion tax dispute between Vodafone Group PLC (>> Vodafone Group plc) and the Indian government will likely drag on after the finance minister did not propose revoking a controversial retrospective tax rule change in 2012.

Vodafone said in a statement on Thursday it intended to push ahead with international arbitration to resolve the dispute.

* No change in import duty on gold and silver from the current 10 percent is negative for companies such as Titan Company Ltd (>> Titan Company Ltd) and Gitanjali Gems Ltd (>> Gitanjali Gems Limited) as some had expected a cut.

(Reporting by India Company News team; Compiled by Devidutta Tripathy; Editing by Sumeet Chatterjee and Miral Fahmy)