The Goods and Services Tax (GST) reforms introduced in September 2025 reshape India’s tax system with rate cuts in sectors like education, automobiles, technology, and many others.
The changes aim to lower costs, boost competitiveness, and drive inclusive growth of the next generation. Notably, higher automobile sales are expected to create multiplier effects across the economy, benefiting manufacturers, dealerships, service providers, drivers, and auto-finance companies.
Under the new GST reforms, the tax on small cars has been reduced from 28 percent to 18 percent. This category includes petrol cars with engines below 1,200 cc and a length under 4 meters, and diesel cars with engines below 1,500 cc and a length under 4 meters.
Two-wheelers above 350cc and larger cars are now subject to a uniform 40 percent luxury goods tax, while electric vehicles (EVs) remain in the 5 percent tax bracket, without an earlier addition of cess.
Maruti Suzuki India Limited
With a market cap of Rs. 5.05 lakh crores, the stock moved up by around 3 percent on BSE, rising to Rs. 16,321 on Tuesday. The company announced significant price reductions across models following the GST revisions. The entry-level Alto K10 became cheaper by Rs. 1.07 lakh, now priced at Rs. 3,69,900, while the Grand Vitara saw an identical reduction, bringing its price to Rs. 10,76,500.
Maruti Suzuki reported its strongest start to Navratri in 35 years, with nearly 80,000 inquiries and 30,000 passenger vehicle deliveries on Sunday alone. Since 18th September, when the company introduced additional price cuts alongside GST reductions, it has received over 75,000 bookings, averaging about 15,000 per day – around 50 percent higher than usual.
Hyundai Motor India Limited
With a market cap of Rs. 2.2 lakh crores, the stock moved up by around 5 percent on BSE, rising to Rs. 2,846.9 on Tuesday. The company reported that the auspicious start of Navratri, supported by the momentum from GST 2.0 reforms, drove strong positivity in the market. On Day 1 alone, Hyundai Motor India achieved approximately 11,000 dealer billings, marking its highest single-day performance in the past five years.
Management indicated that the company anticipates sustained festive demand in the coming weeks and remains focused on delivering value and excitement to its customers.
Tata Motors Limited
With a market cap of Rs. 2.57 lakh crores, the stock moved up by around 2 percent on BSE, rising to Rs. 707.8 on Tuesday. The company was among the first to announce price reductions following the GST reforms, with cuts of up to Rs. 1.55 lakh across popular models. The Tiago received a price reduction of up to Rs. 75,000, while the Tigor saw a cut of up to Rs. 80,000. Prices were also lowered on the Altroz, Punch, Nexon, Curvv, Harrier, and Safari models, with maximum savings reaching Rs. 1.55 lakh.
Mahindra & Mahindra Limited
With a market cap of Rs. 4.49 lakh crores, the stock moved up by around 3 percent on BSE, rising to Rs. 3,680 on Tuesday. The SUV manufacturer announced price reductions across major models to reflect the GST rate cuts. The Bolero, Bolero Neo, XUV 3OO, and Thar 2WD (Diesel) now fall under the 18 percent tax bracket, while other models attract 40 percent GST. Price reductions on vehicles such as the XUV 3XO, Thar range, and Scorpio reached up to Rs. 1.56 lakh.
Written by Shivani Singh
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