The government of India has slashed GST rates of namkeen and savoury products in its latest GST council meeting held on Monday, September 9.
Shares of packaged snack companies, Bikaji Foods, Gopal Snacks & Prataap Snacks, jumped as much as 9 per cent during the trading session on Tuesday, September 10 as the government of India has slashed GST rates of namkeen and savoury products in its latest GST council meeting held on Monday, September 9.
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In its 54th GST Council meeting, Finance Minister Nirmala Sitharaman announced that the GST rate on ethnic snacks or packaged namkeen products has been reduced prospectively to 12 per cent from 18 per cent earlier. However, the FM stated that snacks made using the extrusion process would be taxed at 18 per cent. Un-fried or uncooked snack pellets will be taxed at 5 per cent.
“The GST rate of extruded or expanded products, savoury or salted (other than un-fried or un-cooked snack pellets, by whatever name called, manufactured through process of extrusion), falling under HS 1905 90 30 to be reduced from 18 per cent to 12 per cent at par with namkeens, bhujia, mixture, chabena (pre-packaged and labelled) and similar edible preparations in ready for consumption form which are classifiable under HS 2106 90,” the Ministry of Finance notification read.
“To also clarify that the reduced GST rate of 12 per cent on extruded or expanded products, savoury or salted (other than un-fried or un-cooked snack pellets, by whatever name called, manufactured through process of extrusion), falling under HS 1905 90 30 is applicable prospectively,” the notification read.
Shares of Gopal Snacks Ltd surged 8.5 per cent to Rs 354 on Tuesday, commanding a total market capitalisation of more than Rs 4,300 crore. The scrip had settled at Rs 326.30 on Monday. Gopal Snacks offers a variety of snack products including ethnic snacks like namkeen, gathiya and more.
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Prataap Snacks Ltd, the company which sells its products under the ‘Yellow Diamond’ brand, surged more than 8 per cent to Rs 877.10 during Tuesday’s session. The total market capitalization of the company jumped more than Rs 2,000 crore. The scrip had settled at Rs 811.70 on Monday.
Bikaji Foods International Ltd rose 7.67 per cent for the day to hit Rs 899 mark, merely shy of its 52-week high at Rs 901. The total market capitalization of the company stood close to Rs 22,000 crore. The counter had settled at Rs 834.95 in the previous trading session on Monday.
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