GST Beneficiaries from Morgan Stanley coverage universe are as under,
MM (Rs 1266): GST on large SUVs will likely be lower than current taxes of 24% making MM's UV2 portfolio more affordable.
Ashok (Rs 86), Eicher (Rs 15562) and Tata Motors (Rs 378): Higher tonnage vehicles will be in greater demand as state borders become less relevant
Hindustan Unilever (Rs 821), Colgate (Rs 975) and Asian Paints (Rs 856): All consumer companies will likely benefit from the proposed GST, companies with higher logistics costs and those which compete with unorganized trade – or indeed those whose area-based incentives have expired
Titan (Rs 353): Precious metals currently enjoy concessional rates of around 1% as VAT. The GST committee has suggested that this could be subjected to higher levies of up to 6% to avoid the standard GST rate climbing closer to 19%. Based on our discussion with the industry, it is likely that even if a higher rate is applied, its impact can be blunted by reducing the import duty on gold.
Future Retail (Rs 152) & Jubilant foods (Rs 1409): Box retail businesses benefit. They will be able to set off costs like service tax on advertisement and capex related spending.
Dish (Rs 98) & Hathway (Rs 42)- Total tax incidence is about 22.5% and 19-20%, respectively currently. This can go down to a lower rate under the GST law thus helping profitability. The company believes entertainment tax will be subsumed within GST.
Havells (Rs 301): The GST law will render unorganized segment less competitive in the medium term and help organized players gain market share. In addition, the company will be able to consolidate its warehouses, which will drive some cost savings.
