Moneycontrol Be a Pro
Get App
Last Updated : Jun 05, 2017 11:14 AM IST | Source: Moneycontrol.com

Britannia Industries rises 4% after GST rates fixed for biscuits

After detailed discussions on taxation of biscuits, the GST Council finally decided on a GST rate of 18 percent on all categories of biscuits on June 3.

 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Britannia Industries shares gained nearly 4 percent intraday Monday after GST rates on biscuits are fixed by the GST Council.

After detailed discussions on taxation of biscuits, the GST Council finally decided on a GST rate of 18 percent on all categories of biscuits on June 3.

"GST rate is tax neutral if you look at the current rate. So it is not going to impact us either way, positively or negatively. It is a very fair move from the government," Varun Berry, MD of Britannia Industries said in an interview with CNBC-TV18.

Close

However, Harpreet Singh, Partner, Indirect Tax at KPMG India said this was little surprising, as like footwear and textiles, this industry was also expecting two rates i.e. a lower rate for cheaper biscuits used by the 'aam aadmi' and a residual higher rate for costly cookies meant for the elite class.

He feels this GST rate definitely appears to be on the higher side. Also, with cutthroat competition in this industry and thin margins, it is likely that the impact of rate increase is passed on to the consumer, according to him.

Therefore, eat all your cookies before July 1 or change your taste buds and shift to other confectioneries, Singh advised.

The biscuit manufacturer expects June month to be very tight month as dealers are expected to de-stock.

“If GST gets implemented smoothly then hopefully this is going to have a fairly good impact on growth in the fast moving consumer goods (FMCG) industry as a whole”, Berry said.

He looks forward to a solid economy and a solid growth for companies like Britannia in next three-six months.

At 10:54 hours IST, the stock price was quoting at Rs 3,652.00, up Rs 76.75, or 2.15 percent on the BSE.

Posted by Sunil Shankar Matkar

The Great Diwali Discount!
Unlock 75% more savings this festive season. Get Moneycontrol Pro for a year for Rs 289 only.
Coupon code: DIWALI. Offer valid till 10th November, 2019 .
First Published on Jun 5, 2017 11:14 am
Loading...
Sections
Follow us on
Available On
PCI DSS Compliant