Unofficial gauges: What they say is more important than you think; 4 retail stocks with an upside potential of over 22%
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Business Upturn
8 minutes ago
- Business Upturn
These companies and sector stocks in focus tomorrow as Centre proposes lower GST
The government's proposal to simplify the Goods and Services Tax (GST) structure by scrapping the 12% and 28% slabs and moving to a two-rate system of 5% and 18% is set to put several sector stocks in focus when markets tomorrow. While these changes are still at the proposal stage, Prime Minister Narendra Modi has assured that a 'Diwali gift' in the form of GST rationalisation is on the way. According to analysts, the biggest boost could come for the cement sector, where the current 28% GST is likely to be reduced to 18%. A cut of this magnitude would directly lower cement prices, potentially improving volumes and demand in housing and infrastructure projects. Stocks such as Ultratech Cement, Shree Cement, Ambuja Cements, Dalmia Bharat and ACC will be in sharp focus. The automobile sector is also expected to benefit significantly, as cars, SUVs and two-wheelers currently taxed up to 50% could see lower effective taxation. This could make vehicles more affordable and revive demand. Key stocks to watch will include Maruti Suzuki, Tata Motors, Mahindra & Mahindra, Bajaj Auto and Hero MotoCorp. Consumer durables and white goods makers are likely to be another big beneficiary. Products such as air conditioners, refrigerators, washing machines and televisions currently taxed at 28% may fall to 18%, giving a boost to festive season demand. Companies such as Voltas, Havells, Whirlpool, Blue Star and Dixon Technologies could see renewed investor interest. Additionally, real estate and housing-related companies may benefit indirectly from lower input costs. Developers and construction players such as DLF, Godrej Properties, Oberoi Realty and Prestige Estates could be in play. Other categories like electronics, textiles, processed foods, fertilisers, renewable energy and insurance services are also expected to see positive impact from rate rationalisation, though the fine print will determine the extent of benefits. Overall, the GST proposal is seen as a move to simplify compliance, lower costs and spur consumption, which could lift sentiment across consumption-linked and infrastructure-driven stocks in the near term. Ahmedabad Plane Crash
Hindustan Times
2 hours ago
- Hindustan Times
Reforming the GST regime
The Goods and Services Tax (GST), when it was finally implemented after decades of labour, was India's largest ever indirect tax reform. It created a nationally unified market and a unique federal forum for governing it. Doing away with state-level bumps in the indirect tax regime, however, was only one of the GST's promises. It was also expected to make the tax regime simple, especially in terms of slabs. Prime Minister Narendra Modi's Independence Day speech has raised hopes of this promise being fulfilled eight years after GST's roll out. Speaking from the ramparts of Red Fort — the directional changes were later shared by finance ministry officials — Modi said that the Union government has sent a proposal to the Group of Ministers (GoM) constituted by the GST Council to unleash second generation reforms in GST, which, among other things, will bring most items under just two slabs of 'standard' and 'merit' with some exceptions being put under 'special rates'. HT reported earlier that the Centre has been mulling this, but also pointed out how the GST Council has not met for a long time now. While Modi announced that the reforms, especially on the slab front, would likely be rolled out before Diwali (second half of October), a GST Council meeting is yet to be notified. The idea, at least in principle, ought to be welcomed unequivocally. It will simplify the tax regime and take politicking out of setting tax slabs. However, the devil may very well lie in the details. Any large-scale revision in GST slabs will have to take into account its revenue implications as well as a possible inflationary impact. These two are likely to work in opposite directions and are critical factors for the fiscal and political health of the governments in charge, both in the Centre and the states. One would like to believe that a large part of this homework has been done by the GoM and state governments are on the same page with some of these salient findings. We will know more when these proposals are discussed in the next GST Council. A simplified GST is a much-needed step in India's long, even if gradual, road to reforms. Ideally, this reform should have happened earlier and definitely not in the current environment of global economic turmoil. But that's what political friction to reform sometimes entails.
NDTV
2 hours ago
- NDTV
PM Modi Urges States To Cooperate In Implementing Proposed GST Reforms
New Delhi: Prime Minister Narendra Modi on Sunday said the Centre has circulated the draft of the next-generation GST reforms among states and sought their cooperation to implement the proposal before Diwali. He said the reform in GST would benefit poor and middle-class people, as well as small and big businesses. Addressing an event after the inauguration of two expressways, the prime minister said the Centre intends to make the GST law simpler and revise tax rates. Modi had announced the proposal to reform the GST law in his Independence Day speech on August 15 from the ramparts of the Red Fort. "For us, reform signifies the advancement of good governance, which is why we place a strong emphasis on continuous improvement. In the near future, we are set to implement reforms aimed at making life and business operations smoother and more convenient. "As part of this vision, next-generation reforms will be introduced under the GST framework. This Diwali, these GST reforms will bring a double bonus to the people, enhancing their celebrations," he said. Modi said the Centre has sent the draft proposal of the GST reform to the states. "I hope that all states will cooperate in the initiatives of the central government," he said, urging them to complete the process at the earliest so that the Diwali festival becomes more fabulous. "The objective of this reform is to make GST simpler and revise rates," he added. The present GST tax rates of nil/zero on essential food items, 5 per cent on daily use products, 12 per cent on standard goods, 18 per cent on electronics and services and 28 per cent on luxury and sin goods will be replaced by two tax slabs of 5 per cent and 18 per cent plus a special 40 per cent top bracket for 5-7 demerit goods. The proposed two-slab regime, if approved by the GST Council, will replace the current four slabs in the Goods and Services Tax (GST) regime, doing away with the 12 per cent and 28 per cent slabs. The changes that have come about after nearly six months of deliberations and dozens of meetings have been conceived in a way to ensure that demand for tax tweaks does not arise, and also that input tax credit (ITC) does not get accumulated in the system. The move comes after US President Donald Trump imposed a 25 per cent tariff on all goods India exports to the US, and planned doubling of the levy to 50 per cent from August 27 to punish New Delhi for its oil purchases from Russia. The tariffs are likely to impact USD 40 billion of non-exempt Indian exports such as gems and jewellery, textiles and footwear. The prime minister pitched for becoming 'vocal for local', exhorting Indians to buy made-in-India products. "To make India stronger, we must take inspiration from Chakradhari Mohan (Lord Shri Krishna) to make India self reliant, we must follow the path of Charkhadhari Mohan (Mahatma Gandhi)," he said. The prime minister further highlighted the trust shown by citizens in made-in-India mobile phones. "Eleven years ago, India imported most of its mobile phones. Today, the majority of Indians use made-in-India phones. India now manufactures and exports 30 to 35 crore mobile phones annually," stated the PM. Urging all citizens to place their trust in products made in India, the prime minister appealed to the people to choose Indian-made goods, stating, "If you are Indian, buy what is made in India." Referring to the ongoing festive season, Modi urged everyone to share the joy of local products with their loved ones. He called upon citizens to make a conscious decision to gift only those items that are made in India and crafted by Indians. Addressing shopkeepers across the country, acknowledging that some may have sold foreign-made goods in pursuit of slightly higher profits, the prime minister clarified that they have done nothing wrong, but urged them to now embrace the mantra of "vocal for local". He emphasised that this single step will benefit the nation and every item sold will support an Indian labourer or a poor citizen. Emphasising that the money from each sale will remain within India and benefit fellow Indians, Modi said that this will enhance the purchasing power of Indian citizens and strengthen the economy. He appealed to shopkeepers to sell made-in-India products with pride. Noting that made-in-India UPI (unified payment interface) has today become the world's largest real-time digital payment platform, the prime minister highlighted that Indian-made rail coaches and locomotives are now witnessing growing demand in other countries. The GST Council is expected to meet next month to deliberate on the tax reform proposal. As many as 99 per cent of items in the 12 per cent category, such as butter, fruit juices and dry fruits, would move to a 5 per cent tax rate. Similarly, electronic items like ACs, TVs, fridges, and washing machines, as well as other goods like cement, will be among the 90 per cent of the items that will move from 28 per cent to a lower 18 per cent slab. About 20 per cent of items, including packaged food and beverages, apparel and hotel accommodation, are currently taxed at 12 per cent GST and account for 5-10 per cent of consumption and 5-6 per cent GST revenue. Moving them to a lower 5 per cent slab may lead to loss of revenue, but the Central government is hopeful that a boost in consumption would be able to make up for the deficit in the next few months. A special tax rate of 40 per cent - the maximum rate allowed under the GST law - would be charged for demerit and sin goods like tobacco, gutka, and pan masala, as well as online gaming, highly placed sources told reporters soon after the prime minister's announcement of GST revamp in his Independence Day address to the nation.
