ET NEWS

Shares of Mahindra & Mahindra surged as much as 7.8% to Rs 3,539.25 on Thursday after brokerages flagged the automaker as one of the biggest winners from India’s sweeping Goods and Services Tax (GST) overhaul. Analysts at Jefferies and Emkay Global said the tax restructuring delivers significant relief across automobiles, with SUV tax cuts a “surprise win” for M&M.The rally in M&M mirrored broader strength in auto counters, with the Nifty Auto index advancing nearly 4% after the GST Council collapsed the existing four-rate structure into two slabs, 5% and 18%, while maintaining a special 40% levy for luxury and sin goods. The new system, branded “GST 2.0,” takes effect on September 22.Petrol, hybrid, LPG and CNG cars under 1,200cc and 4 meters will now face an 18% GST, down from 28%, while diesel cars up to 1,500cc also move into the lower slab. Larger SUVs will be taxed at 40%, compared with 43-50% earlier, easing the burden on mass-market and premium buyers alike.Brokerages see demand recoveryJefferies called the GST cuts “a big positive” for the sector, saying tax reductions of 10 percentage points on two-wheelers and 11-13 points on small cars could spur a significant demand inflection. For SUVs, it highlighted a 5-10 point reduction to 40% as a “surprise win” for M&M, alongside cuts for tractors and commercial vehicles.Emkay Global echoed the optimism, noting M&M “turns out to be the biggest beneficiary of GST cuts” within its coverage universe, with nearly two-thirds of its portfolio shifting to the 40% rate from 50% earlier, and the rest to 18% from 28%. The brokerage said the changes could lift auto demand by 5-10% across categories, while a sharp cut in tractor GST—from 12% to 5%—provides a strong rural boost.Industry implicationsThe Council’s move to impose a uniform 18% rate on all auto components also removes inverted duty structures, which brokerages said will support domestic suppliers. Electric vehicles remain taxed at 5%, offering continuity for ongoing electrification efforts.Arun Agarwal, vice president of fundamental research at Kotak Securities, said lower prices should help mass-market segments recover faster, while “auto components players having higher domestic exposure will benefit from stronger OEM demand.”For M&M, brokerages said the overhaul arrives ahead of the festive season and could provide a meaningful lift in sales across SUVs, tractors and commercial vehicles.Also read | Sensex rallies over 700 pts, Nifty tops 24,900; GST cuts, 4 other drivers behind today's rally(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)

Tata Steel shares dipped 0.50% to Rs 167 on Thursday, retreating after a robust 6% gain in the previous session. The slight pullback occurred despite ongoing optimism in the metal sector, supported by global supply dynamics and domestic protective policies.On Wednesday, Indian metal stocks surged as investors responded to expectations of firmer global steel prices, fueled by China’s planned production cuts and India’s tariff protections.Analysts at CLSA believe steel prices are likely to strengthen, supported by seasonal demand and a broader global recovery. They highlighted China's new “anti-involution” strategy — aimed at curbing excessive competition — as a potential boon for Indian producers. The world's largest steelmaker, China, is expected to cut output by 50 million tons in 2025, an 8.5% reduction for the remainder of the year. Notably, output had already declined by 20 million tons between January and July, even as export volumes soared to record levels.Despite today’s minor pullback, Tata Steel remains near its 52-week high of Rs 170.18, reflecting solid recent momentum. Over the past year, the stock has delivered an 11% return, indicating stable performance. With a current market capitalization of Rs 2,08,599 crore, the company continues to be a key player in India’s steel industry.According to data from Trendlyne, the consensus recommendation from 31 analysts for Tata Steel is a "Buy", indicating strong positive sentiment around the stock's prospects.On the technical front, the 14-day Relative Strength Index (RSI) stands at 64.0, suggesting bullish momentum without being in overbought territory (RSI above 70 is typically considered overbought, while below 30 is oversold).Additionally, Tata Steel is showing strong technical strength by trading above all 8 key Simple Moving Averages (SMAs) — from the 5-day to the 200-day SMA — which is a bullish indicator and reflects a sustained upward trend.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)