Benchmarks trade with minor gains; FMCG shares rally for 5th day

The key equity indices traded with small gains in the early afternoon trade after the government cut taxes on several goods as part of a major GST overhaul. The move aims to boost consumer spending ahead of the festive season and ease the impact of high U.S. tariffs, among other factors. Market participants? focus on GST reforms announced by the GST Council eclipsed the impact of the weekly expiry of Sensex F&O contracts. The Nifty traded above the 24,750 mark.

FMCG shares jumped after GST council reduced the rate from 12% and 18% to 5%. The index witnessed buying demand for the fifth consecutive trading session.

At 12:25 ST, the barometer index, the S&P BSE Sensex, rallied 237.16 points or 0.29% to 80,805.74. The Nifty 50 index added 55.85 points or 0.22% to 24,771.90.

In the broader market, the S&P BSE Mid-Cap index shed 0.34% and the S&P BSE Small-Cap index fell 0.29%.

The market breadth was positive. On the BSE, 1,925 shares rose and 2,033 shares fell. A total of 205 shares were unchanged.

GST Reforms:

The GST Council approved the significant rate cuts on several essential items. Effective from September 22nd, the new rates aim to boost consumption by shifting to a two-slab structure of 5% and 18%, abolishing the 12% and 28% rates. A special 40% GST slab has been introduced for super luxury and sin goods.

In a major relief to the automobile and two-wheeler sector, GST on small cars and motorcycles with engine capacity up to 350cc has been reduced from 28% to 18%, a move aimed at boosting demand in the mass mobility segment. Additionally, parts and accessories of motorcycles up to 350cc will now attract 18% GST instead of 28%.

On the other hand, the levy on premium motorcycles exceeding 350cc has been sharply raised from 28% to 40%, making high-end bikes costlier.

The GST Council exempted individual life and health insurance policies from the 18% Goods and Services Tax (GST).

Several fast-moving consumer goods (FMCG) currently taxed at 12% or 18% will now fall under the 5% bracket. Further, GST on tractors (except road tractors for semi-trailers above 1800cc) has been redcued to 5% from 12%. For road tractors with engines above 1800cc, the tax was lowered to 18% from 28%. Additionally, GST on tractor tyres and parts was slashed from 18% to 5%.

In education segment, the council reduced GST on pencils, crayons, pastels, drawing charcoal, chalk sticks, and tailor?s chalk from 12% to nil. Exercise books, graph books, laboratory notebooks, and notebooks too have been exempted from GST, compared with 12% earlier. Additionally, boxes, pouches, wallets, and writing compendiums of paper or paperboard containing assorted stationery will now attract 5% GST instead of 12%.

Buzzing Index:

The Nifty FMCG index rose 0.61% to 57,315. The index jumped 3.06% for the fifth trading sessions.

Emami (up 3.89%), Britannia Industries (up 3.85%), Colgate-Palmolive (India) (up 3.64%), Nestle India (up 1.95%), Dabur India (up 1.8%), Marico (up 1.07%), ITC (up 1.02%), United Breweries (up 0.7%), Patanjali Foods (up 0.63%) and Hindustan Unilever (up 0.54%) advanced.

Derivatives:

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, rose 1.60% to 11.11. The Nifty 30 September 2025 futures were trading at 24,885.20, at a premium of 113.3 points as compared with the spot at 24,771.90

The Nifty option chain for the 30 September 2025 expiry showed a maximum call OI of 59.8 lakh contracts at the 25,000 strike price. Maximum put OI of 49.9 lakh contracts was seen at 24,000 strike price.

Stocks in Spotlight:

CFF Fluid Control advanced 1.83% after the company announced that it had received a Letter of Intent (LOI) from the Indian Navy?s Material Organisation for the supply of various equipment under the P75 submarine project.

Axiscades Technologies rose 0.85%. The company said that its subsidiary, Mistral Solutions, has secured contracts for the development of production line testing equipment for global contract manufacturers supporting one of two hyperscaler clients

Powered by Capital Market - Live News