Shares of India's snacks companies surged up to 8.5% on Tuesday after the Finance Ministry slashed the goods and services tax on 'namkeen' and savoury items.
In the 54th GST Council meeting on Monday, Finance Minister Nirmala Sitharaman cut the indirect tax payable on 'namkeen', extruded, and expanded savoury items prospectively from 18% to 12%.
Snacks makers such as Bikaji Foods International Ltd., Gopal Snacks Ltd. and Prataap Snacks saw their shares surge in trade.
The Finance Minister also announced the formation of two new groups of ministers that will address issues related to tax rates and compensation cess. The first GoM will focus on medical and health insurance and the second on rate rationalisation.
While cutting the tax on 'namkeen' and similar savoury items, the ministry reduced rates on specified cancer drugs from 12% to 5%.
Bikaji's stock rose as much as 7.77% during the day to Rs 899.8 apiece on the NSE. It was trading 4.9% higher at Rs 876.6 apiece, compared to a 0.18% advance in the benchmark Nifty 50, as of 9:34 a.m.
Gopal Snacks stock rose as much as 8.59% during the day to Rs 354.5 apiece on the NSE, while Prataap Snacks' scrip surged as much as 7.79% to Rs 877 apiece in early trade.
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