HUL Shares: SEBI Analyst Flags Bullish Call, Says Stock Is Best Placed To Benefit From GST 2.0

The Goods and Services Tax (GST) Council announced sweeping reforms on Wednesday. From September 22, GST will be simplified to just two main tax slabs-5% and 18%. A higher 40% slab will apply only to luxury and sin goods. 

In a big boost for consumers, everyday essentials like packaged food, toothpaste, milk products, and personal care items will now attract only 5% GST, down from the earlier 12–18%. 

SEBI-registered analyst A & Y Market Research explained what this means for the fast-moving consumer goods (FMCG) sector at large and why they are bullish on Hindustan Unilever (HUL) now. 

GST 2.0: Analyzing The Impact

A & Y Market Research explained that with revised GST rates now, consumers are likely to save more money, which would lead to a higher disposable income. With inflation projected to drop by up to 1.1%, everyday products may become more affordable, fueling demand for the FMCG sector. 

They noted that in an attempt to capitalize on this shift, FMCG companies are strategizing on how best to pass on the benefit to customers. Larger packs are likely to receive direct price cuts, while smaller packs in the ₹5–₹10 range may offer increased quantity at the same price.

The Nifty FMCG index jumped nearly 2%, with stocks such as Britannia, Colgate, Dabur, HUL, and Nestlé rising between 3% and 6%. Economists believe these reforms could add 1–1.2% extra GDP growth in the next 1 year. 

Bullish Bet On HUL 

A & Y Market Research is bullish on Hindustan Unilever (HUL) from the FMCG pack. They believe it will benefit directly from the GST cut to 5% as the company sells daily essentials such as soap, shampoo, toothpaste, and packaged food. 

With its extensive distribution network and strong brands, HUL is well-positioned to capture higher demand. Additionally, the company has a long record of steady growth and strong brand loyalty, making it a safe and strong long-term bet. 

Trading Call

From a trading perspective, HUL has broken past its swing high and the key resistance level of ₹2,590. They recommended buying HUL between ₹2,580 and ₹2,590, with a stop loss at ₹2,450. Targets have been pegged at ₹2,850, ₹3,030, and ₹3,230.

What Is The Retail Mood?

Data on Stocktwits shows that retail sentiment has remained 'bearish' for a week.

HUL shares have risen 14% year-to-date (YTD).

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