IGI Logo

Below the Quote on Auto Sector impact due to potential GST Cut by  Arun Agarwal, VP-Fundamental Research, Kotak Securities 

The potential GST cuts for the automotive products to 18% would lower on-road prices across segments. We believe lower prices would stimulate demand recovery, and the impact would be more in the mass-market segment. Auto manufacturers (OEM) would gain from higher revenue and potentially higher margin, resulting in possible earnings upgrade. Auto ancillaries would also gain from the potential GST cut, however the impact would vary depending on geographical exposure. Auto ancillary companies having higher revenue exposure in the domestic market stands to benefit more, whereas the gains for global suppliers would be lower given higher export exposure and tariff-related uncertainty.

Above views are of the author and not of the website kindly read disclaimer