Tariff Headwinds Dampen Benefits Of GST Cuts — Read Motilal Oswal's Report

U.S. CPI inflation climbed sharply due to post-pandemic recovery, global supply chain shocks, and fiscal stimulus, peaking at 9.1% in Jun’22, far above any tariff-related impact..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Motilal Oswal Report.GST reforms poised to boost consumption growth engineThe Finance Ministry has proposed a significant overhaul of the GST structure, rationalizing it into two primary slabs — 5% for essentials and 18% for most goods — while retaining a peak rate of 40% for luxury and sin items. These GST reforms are intended to cushion Indian industries and consumers, revive domestic consumption, and provide relief to sectors facing steep US tariff headwinds such as automobiles, garments, and electronics. Key segments likely to benefit include: Consumer Staples (boosted by stronger demand and lower input costs), Automobiles (especially fourwheelers), Cement, Hotels (sub-Rs 7,500 room inventory), Retail (footwear), Consumer Durables (notably RACs), Logistics, Quick Commerce, and Electronics Manufacturing Services (EMS, with improved demand prospects particularly for ACs)..Trade tariffs are starting to reflect in US inflationUS CPI inflation climbed sharply due to post-pandemic recovery, global supply chain shocks, and fiscal stimulus, peaking at 9.1% in Jun’22, far above any tariff-related impact. Aggressive monetary tightening by the Federal Reserve helped bring inflation down significantly through 2023- 24, restoring price stability closer to the 2-3% range. With the latest tariff announcements, inflationary pressures are re-emerging, as higher import costs begin feeding into consumer prices. CPI has edged higher in recent months; while tariffs are not the sole driver, their contribution is becoming more visible and is expected to intensify.  US CPI is now expected at 2.8-3.3% in CY25 (well above the Fed’s earlier target of 2%), as tariffs and sticky inflation slow the pace of disinflation..The key highlights of the 'The Eagle Eye' are as follows:India underperforms global equities monthly and YTD;Trade tariffs are starting to leave a visible imprint on U.S. inflation; Estimated GDP impact of US Tariffs by country; GST reforms poised to boost the consumption Growth Engine; A review of India markets since Sep’24 highs; Earnings remain muted, however, domestic flows hits record highs; About 70% of the BSE-200 constituents end lower in Aug’25; Earnings growth outpaced the index only in Midcaps; DII monthly inflows hit second-highest level, FII outflows intensify; India–US 10-year yield spread widens marginally after hovering near historical lows; Large-cap valuations near their average; small- and mid-caps remain stretched. .Click on the attachment to read the full report:.'Buy' ICICI Bank Shares Maintains Motilal Oswal, Sees Upto 20% Potential Upside — Check Target Price .DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Tariff Headwinds Dampen Benefits Of GST Cuts — Read Motilal Oswal's Report

With the latest tariff announcements, inflationary pressures are re-emerging, as higher import costs begin feeding into consumer prices.

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