BSE Auto index gains by nearly 2 per cent, Hero MotoCorp zooms by more than 6 per cent

BSE Auto index, which is mostly led by two-wheeler stocks, gained by 1.50 per cent and was one of the top index gainers amongst all sectoral indices on Wednesday.

Two-wheelers are currently taxed at the highest slab rate of 28 per cent. In India, two-wheelers cannot be considered as a luxury or sin product, and hence, such high GST rates not only affect its demand but also painfully pinch the buyers’ pockets especially during the current difficult economic conditions.

During an interaction with members of Confederation of Indian Industry (CII), Finance Minister Nirmala Sitharaman mentioned that Goods & Services Tax (GST) Council would look into the auto industry’s demand for lowering the tax rate on two-wheelers. A revision made in two-wheeler rates can positively boost sales during the upcoming festive seasons.

As a result of the positive expectation, the stocks of two-wheeler companies such as Hero MotoCorp, TVS Motor Company, Bajaj Auto, etc. were shining during Wednesday’s trading session gaining by 6.43 per cent, 4.88 per cent and 2.42 per cent, respectively.