Shares of jewellery companies rallied by up to 15% on BSE in early morning trade after the Goods and Services Tax (GST) Council fixes GST rate at 3% for gold, gems and jewellery.
At 9:28 am, Titan Company, PC Jeweller, Gitanjali Gems, Tribhovandas Bhimji Zaveri (TBZ), Tara Jewels, Thangamayil Jewellery and Renaissance Jewellery were up more than 2% each, as compared to 0.20% decline in the S&P BSE Sensex.
“Currently, gold jewellers pay one per cent excise and 1.2% value-added tax (VAT) over and above the 10% customs duty on bullion. This effectively works out to 12.43%. With the introduction of GST at 3% for gold and 18% for making charges, and keeping customs at 10%, the effective rate comes to 15.67%. So, the effective price escalation on gold jewellery comes to 3.24%. This is still a win-win for gold jewellers; they would not have expected anything better than this, particularly after the chief economic advisor’s report of Rs 10,800-crore subsidy on gold,” the Business Standard report suggests.
Among the individual stocks, Titan Company, the largest gainer among the pack, has rallied to its record high of Rs 543, up 15% on the National Stock Exchange (NSE) in intra-day trade. The trading volumes on the counter more than doubled with a combined 3.1 million shares changed hands on the NSE and BSE so far.
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