From Hero Moto, HUL, Voltas To Ultratech Cement SEBI Analyst Flags Stocks To Watch Ahead Of Potential GST Rationalization

Investors are eyeing the upcoming Goods and Services Tax (GST) Council meeting on Sept. 3–Sept. 4 as a potential catalyst, with expectations of a significant rate rationalization. 

Around 175 products are under discussion, with proposals to reduce the tax rates on many items from 28% to 18% and from 12% to 5%. SEBI-registered research analyst Finkhoz said the outcome could provide the market's next big trigger ahead of the festive season.

Sectors That Stand To Gain

A cut in GST on two-wheelers and small cars from 28% to 18% could reduce on-road prices by 6–8%, improving affordability and boosting demand. 

Finkhoz highlighted Hero MotoCorp, TVS Motor, and Maruti Suzuki as key beneficiaries.

On the durable side, Samsung, LG, Voltas, and Blue Star could see stronger sales momentum.

In the cement and real estate sectors, a potential reduction from 28% to 18% could lower building costs and improve project economics, providing a boost to developers and private infrastructure players. UltraTech, JK Cement, and Ambuja were cited as names to track. 

Hotels, travel, and food services may benefit from a reduction in GST on room tariffs below a certain threshold, which would support budget hotels and domestic tourism. 

Lower GST on consumer goods could also support logistics, retail, and quick commerce players by improving volumes and inventory turnover.

GST Reforms: Why It Matters

Finkhoz noted that cuts could trigger demand ahead of Diwali. 

If the government offsets revenue loss by shifting some cess items into GST and broadening the base, the impact on fiscal receipts may be contained. The final details will determine the scale of the benefit.

Markets have already moved higher in anticipation, with auto and consumer stocks leading early gains. 

Traders are watching three key announcements: the official list of items with new slabs, details on funding the cuts through cess adjustments, and any state compensation package or timeline.

How To Play The GST Changes?

Finkhoz suggested favouring high-beta consumer, auto, and cement stocks in the announcement but cautioned about profit-taking if details fall short of expectations. 

Likely outcomes include reductions for consumer durables, selected FMCG products, and autos such as hybrids, small cars, and two-wheelers. A cement cut would have a high impact, but it remains conditional. 

The biggest risk is a protracted debate over state compensation, which could delay implementation and dampen market enthusiasm.

GST 2.0 could be the trigger for Diwali demand, Finkhoz said. They added that autos, consumer durables, cement, and logistics are the sectors to watch, but the breakout or fizzle depends on the final list and the funding plan.

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