Shares of FMCG manufacturers rallied after the Finance Minister slashed the corporate tax rates on Friday.
Meanwhile, the S&P BSE Sensex was up 1255.79 points or 3.30% to 39,270.41. The market surged after the Finance Minister Nirmala Sitharaman on Friday, 20 September 2019, slashed corporate tax rate to 22% without exemptions. The effective corporate tax rate after surcharge now stands at 25.17%. The step has significant positive implications for corporates' profitability, broader economy and market valuations.The S&P BSE FMCG index was up 5.42% at 11,902.67, outperforming the Sensex.
Among FMCG stocks, Procter & Gamble Hygiene & Health Care (up 8.97%), Britannia Industires (up 8.65%), ITC (up 8.31%), Colgate Palmolive (India) (up 6.68%), Hindustan Unilever (up 6.27%), GlaxoSmithkline Consumer Healthcare (GSK Healthcare) (up 5.7%), Jyothy Laboratories (up 3.64%), Nestle India (up 3.41%), Godrej Consumer Products (up 2.34%), Marico (up 2.18%), Bajaj Consumer Care (up 2.13%), Tata Global Beverages (up 1.7%) and Varun Beverages (up 0.73%) surged higher.
As on 31 March 2019, GSK Healthcare paid a corporate tax of 36.01%. Colgate Palmolive (India) paid a corporate tax of 34.98%. Britannia Industries paid a corporate tax of 34.61%. Nestle India paid a corporate tax of 33.84%. Procter & Gamble Hygiene & Health Care paid a corporate tax of 30.99%. Hindustan Unilever (HUL) paid a corporate tax of 30.44%. Varun Beverages paid a corporate tax of 27.90%.
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