Shares of Havells, Blue Star, Amber Enterprises Rise as FM Announces GST Cut for Consumer Durables

Shares of air-conditioner manufacturers rose on Thursday, September 4 after finance minister Nirmala Sitharaman announced that air-conditioners will attract an 18% goods and services tax (GST), down from 28% earlier.

Havells India (Lloyd) shares were up about 1% to Rs 1,582 apiece on the Bombay Stock Exchange (BSE) at 12 pm IST.

Stocks of Blue Star, Amber Enterprises and PG Electroplast also advanced 0.6%, 1.5% and 1.22% respectively; Symphony rose 4.4%.

The GST rate cut comes as a relief for air-conditioner companies, which saw their businesses hit by unseasonal rains and an early monsoon.

Further, the impact was more noticeable because of an exceptionally high base in the first quarter of the financial year 2024–25, when a harsh and prolonged summer boosted makers’ sales.

GST Cut

The GST Council on Wednesday slashed the tax on several consumer durables, including televisions above 32 inches, air-conditioners and dishwashers, from 28% to 18%.

The government says the reforms will take effect from September 22, 2025, and should push retail prices down by roughly 8–9%. Officials framed the change as part of a wider simplification that consolidates most items into two main GST rates, 5% and 18%.

The 56th GST Council reduced the number of main tax slabs and moved many formerly 28% items into the 18% band. The reform covers large-screen TVs over 32 inches, air-conditioners, monitors and projectors and dishwashers among other goods.

Expected Consumer Impact

Industry executives estimate an 8–9% fall in retail prices for the affected appliances. For example, a 43-inch TV could be at least Rs 2,000 cheaper, while a 75-inch set might fall by as much as Rs 23,000. Typical savings for air-conditioners and dishwashers are pegged at around Rs 3,500–4,500 per unit. Retailers and brands expect the cuts to boost festive-season demand.

Finance minister Nirmala Sitharaman and officials described the package as a simplification aimed at lowering consumer costs and stimulating demand ahead of the festival season.

Manufacturers and retailers welcomed the move as a demand stimulant. Executives told media they expect larger-screen upgrades and a pickup in appliance purchases that were deferred by weak seasonal demand earlier in the year.

Some companies flagged the potential for higher volumes but also said final retail price cuts will depend on how quickly distributors and dealers pass the tax reduction to customers.

Macro Effects

Economists and market analysts say the tax overhaul, while supporting consumption, will lower government receipts (official estimates flag a revenue impact from the package). Policy commentators note the cuts could shave headline inflation modestly and give a short-term boost to domestic demand for consumer durables.

At the same time, a narrower slab structure creates winners (big-screen TV makers, AC brands and retailers) and some losers where rates were moved up or left unchanged.

Short-term differences: actual shelf prices may vary during the first days as distributors and retailers update inventory pricing and pass on savings.

The GST Council’s two-slab reform is a significant tax-policy shift whose immediate, visible effect will be cheaper big-ticket appliances for consumers and a likely uptick in festive spending. How much of the tax cut is translated into lower retail tags, and whether higher volumes offset the revenue loss for the exchequer, will determine whether the move succeeds as a stimulus for India’s consumer-durables sector.

Industry Reaction

Shares of air-conditioner manufacturers rose on Thursday, September 4 after the finance minister announced GST reforms for electronic goods.

Voltas shares were up 0.18% at ₹1,432.90 apiece on the National Stock Exchange at 9:47 a.m. Stocks of Blue Star, Havells India (Lloyd), Amber Enterprises, PG Electroplast, and Symphony also gained 0.9%, 1%, 1.3%, 4.4%, and 0.5%, respectively.

The GST rate cut comes as a relief for air-conditioner companies, whose businesses were impacted by unseasonal rains and an early monsoon.

B Thiagarajan of Blue Star told CNBC TV18, “Our growth estimate for festive-season sales is now 30% versus 15–20% earlier. The entire benefit will be passed on to consumers.”