Auto ancillary stock to refurbish your portfolio

With broader markets searching for a proper trigger that can guide investors, developments on the GST bill front could well be one of the important triggers markets may react to. The most important factual information that corporates will be keen to look for, will be the revenue neutral rate to be declared. 

GST is touted to benefit the economy in general, and specifically the bill is expected to help the Automobile industry.

According to Abhishek Jain,  director, PPAP Automotive Ltd., “GST is a very positive step for the Indian economy as a whole. It has already been adopted by 160+ countries in some form or the other. As one of the biggest economic reforms in India post 1991's liberalisation, it will significantly bring down the complexity in structure of indirect taxation and boost seamless transit of goods and services across the country. The seamless transit of goods and services across the states will lead to integration of the Auto industry, as the auto makers and the suppliers, which are operating in different states will not have to bear the impact of additional tax burden due to operations in different states. This phenomenon will certainly boost the business growth as the suppliers will be more competitive. Consequently, GST will be a booster for the Automobile industry and the industry will see a strong growth due to reduction of overall tax structure. The biggest challenge will be to develop the technology for a smooth and effective implementation.”

PPAP is a leading manufacturer of Automotive Sealing Systems; and Interior and Exterior Automotive parts in India. PPAP Automotive has gained 33 per cent over a 1 year period. On Tuesday, the stock closed at Rs 155.90 per share; whereas Sensex closed at 27990.