GST 2.0: Structural Reform To Boost Demand, Economy; ITC, M&M, BEL Among Key Beneficiaries, Says PL Capital

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PL Capital Report

The Government of India has announced GST 2.0 which has indicated a reduction in taxes to the tune of Rs 480 billion and reduction in taxes on wide ranging items of daily use by common man.

The measures except tobacco will be applicable from Sept 22 which will help revive festival demand. There has been steep cut in taxes on auto, processed foods, personal care, cement, Ac and durables, books and stationery, hotels (3995 mm, cigarettes etc. are placed in 40% bracket.

Food delivery services are likely to be taxed at 18% now. We believe that it will boost demand for consumption-oriented companies.

Key Stocks

Staples - ITC, Britannia Industries, Hindustan Unilever, Godrej Consumer Products, Colgate Palmolive (India), Marico, Bikaji Foods International, Emami and Nestle India.

Apparel/ Footwear – Aditya Birla Lifestyle Brands, Arvind Fashions, Metro Brands, Bata.

Auto - Hero Motocorp, TVS Motor Company, Eicher Motors, Maruti Suzuki India, Mahindra and Mahindra, Hyundai Motor India, Tata Motors, Ashok Leyland.

Cement – Ultratech Cement, Ambuja Cement, Shree Cement, JK Lakshmi Cement etc.,

Life and Health Insurance (Long term),

Durables - Blue Star, Voltas, Whirlpool of India,

Budget Hotels – Lemon Tree Hotels, Samhi Hotels,

Hospitals (cheaper insurance – Apollo Hospitals Enterprise, Max Healthcare Institute, Aster DM Healthcare,

Defense – Hindustan Aeronautics, Bharat Dynamics, Bharat Electronics etc.

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