'The Final Move That...': Dinshaw Irani Hails Potential GST Rate Cuts, Says It Will Reignite 'Fire In Demand'
Helios Capital's Dinshaw Irani believes that the potential GST rate cuts will provide a major demand boost to the economy and improve the outlook for the December quarter earnings growth.
Prime Minister Narendra Modi has promised new GST reforms by Diwali, which will likely bring down the tax load on consumers and MSMEs. D-Street analysts and brokerages have hailed the GST overhaul and expect it to boost demand and consumption and provide a major impetus to consumer-driven sectors such as automobiles and consumer durables.
In an exclusive interview with NDTV Profit, Dinshaw Irani of Helios Capital Management (India) Private Limited said a GST rate cut, if implemented, would provide a significant demand boost to the economy. He added that the upcoming festive season was likely to improve the outlook for December-quarter earnings growth.
GST rate cuts to boost demand growth
"The government's move on giving GST 2.0 is a conscious effort to not only ride the balances but also to move toward consumption. First, it was the RBI interest rate cuts which boosted liquidity into the system, then came Budget 2025, which gave income tax benefits, and now the GST cuts," said Irani. The GST rate cuts are the final step that the government could have taken.
According to Irani, the upcoming festive season will "reignite fire in the demand and consumption growth" by the December quarter of FY26. "The September quarter may not look that great, but the demand will come back with the GST rate cuts," he said. As per Irani, the domestic two-wheeler segment will "definitely benefit" from the rate cut.
Market outlook
According to the market expert, investors should not "sit with cash", but rather put it into instruments even when the market is trading lower. "There are enough opportunities in this market even when it is on its way down," said Irani. As the Nifty 50 reclaims its bull run, financials emerge as the top sectoral pick, according to the D-Street expert.
On fundamentals, Irani is optimistic that the tariff rate imposed by the US will likely go down even below 25% after the final round of negotiations. "I don't believe that the US will be able to continue its trade with India at a 50% tariff rate," he said. On the near-term outlook, Irani believes that "if the GST rate cuts and the RBI liquidity do not impact demand, then that will be a bigger dampener than the tariffs."
