&imwidth=800&imheight=600&format=webp&quality=medium "GST revision: Tobacco, auto, cement stocks surge on share markets")
India's stock markets surged following Finance Minister Nirmala Sitharaman's GST rationalisation announcement, with Sensex rising 439.22 points to 81,006.93, and the Nifty rising 131.95 points to 24,847.00 at 11 am. Here's a look at which shares rose after the GST announcement.
How the Indian stock markets reacted to GST announcements
Even though Nirmala Sitharaman announced that cigarettesand other tobacco products would be placed under the 40 per cent GST slab, their stocks surged. At 10 a.m., ITC, VST Industries, and Godfrey Phillips India shares had gained between 1-4 per cent, reported Money Control. This is because if tobacco products are taxed at a flat 40 per cent rate without any cess, these items' real taxes would be lower than earlier.
Cement stocks also showed a strong gain because the GST on the essential commodity was lowered from 28 per cent to 18 per cent. The shares of Ultratech Cement, Ambuja Cements, ACC, and Shree Cement rose around 2-3 per cent.
The new GST rates apply to all kinds of cement.
Shares of HDFC Life, SBI Life, Life Insurance Corporation of India (LIC), ICICI Prudential Life, New India Assurance, ICICI Lombard, and Star Health also surged 2-3 per cent as Sitharaman announced the GST Council's decision to cut GST on health and life insurance premiums from 18 per cent to nil.
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The share prices of India's automakers also increased as the GST Council slashed GST on small cars from 28 per cent to 18 per cent.
The ex-showroom prices of the cars are expected to go down by 5-7 per cent.
Mahindra & Mahindra (M&M)'s shares gained nearly 7 percent to trade, while Eicher Motors, Tata Motors, and Maruti Suzuki shares rose more than 2 percent each. TVS Motors, Hero MotoCorp shares wereup by 1 per cent.
Escorts Kubota's shares rallied nearly 9 per cent during early trade because GST on tractors was reduced to 5 per cent.
The central government has decided to slash the 12 per cent and 28 per cent GST slabs. Most of the goods and services in these slabs will be moved to the 5 per cent and 18 per cent slabs.
The government has also introduced a 40 per cent sin tax slab.