GST Real winners and losers

Automobiles

1. All automobile except tractor (12%) will attract a rate of 28% as opposed to current CST and NCCD of 28%-31%.

2. SUV may drop by 6-10%.

3. Luxury cars to be cheaper at a rate of 43% against the current rate of 55%.

Stocks to watch: Maruti, Eicher Motors, Hero Moto, Bajaj Auto and TVS Motor.

“ The tractor makers were amongst the handful, lobbying for being taxed under GST given the loss on account of excise duty and service tax credits on most of its procurements.”
Amit Sarkar, Partner & Head, Indirect Tax, BDO India

Cigrattes

1. Along with GST rate at 28%, the effective tax would be around 55-60%.

2. Wide range of tax rates prevalent in different states are to be removed.

Stocks to watch: ITC, VST and Godfrey Phillips

White goods

1. ACs, refrigerators and water heaters would attract a higher tax rate.

2. Lower tax to be applied on cookers.

3. Tax slab for sanitary ware, faucets and tiles would be higher at 28% from 18-14%

Stocks to watch: Blue Star, Voltas, Havells, Whirlpool, V-guard, TTK, Prestige, Cera, HSIL, Kajaria and Somany.

Fast-moving consumer goods (FMCG)

1. Soaps, toothpaste, hair oil and malted beverages price is likely to fall by 5-6%

2. Detergent, shampoo, skin cream, chocolate prices may go up.

Stocks to watch: Colgate, Pidilite, Godrej Consumer, HUL, Dabur, Nestle, Varun Beverages and Britannia

Paints

To attract a rate of 28% as opposed to current rate of 24-25%.

Stocks to watch: Asian Paints, Berger, Shalimar, Kansai Nerolac and Akzo Nobel.

Metals and Mining

1. Duty on coal would be reduced to 5% from the current 12% rate.
Lower prices to attract power producers away from imported coal.

2. Lower tax on metal ore.

Stocks to watch: Coal India, GMDC, JSW Steel, Tata Steel, Hindalco and Vedanta

Telecom and financial services

GST rate of 18% for the telecom may appear higher as against the current service tax rate of 15%.
However, these sectors are likely to derive substantial benefits on the input credit front given the eligibility of credit on the goods, which was not the case under the current regime.

Stocks to watch: Bharti Airtel, Idea, Reliance Communications