Auto stocks rally 77% as GST rate cuts reshape sector map in September 2025
GST reforms implemented in late September 2025 triggered a sharp market rally. Top gainers included Sona BLW Precision Forgings at 77.05%, while Tata Motors capitalization rose 16% following a demerger.
Prime Minister Narendra Modi announced next-generation GST reforms during an Independence Day address on August 15, 2025. The revised rates for the automobile sector officially took effect from September 22, 2025. This policy change triggered a sharp rally across auto and auto-ancillary stocks globally. Analysts cite valuation re-rating, margin expansion, stronger demand, and replacement cycles as key drivers of the surge.
Sona BLW Precision Forgings emerged as the top performer with a 77.05% gain. Samvardhana Motherson International recorded a 74.01% increase, while Bharat Forge advanced 67.81%. Bajaj Auto rose 45.13%, TVS Motor Company gained 39.06%, and Ashok Leyland moved up 38.86%. Eicher Motors added 33.41%, Bosch rose 21.81%, Exide Industries increased 12.97%, Hero MotoCorp gained 12.75%, and UNO Minda rose 10.37%.
The rally also benefited Tata Motors, which advanced 16% in market capitalization. The company completed a demerger last year. Its combined market capitalization for passenger and commercial vehicle segments shifted from ₹244,686.47 crore to ₹284,439.32 crore.
Mahindra & Mahindra declined 3.53%, Maruti Suzuki India fell 0.61%, and Tube Investments of India dropped 10.71%. Subhash Gate, a Senior Research Associate at Choice Institutional Equities, noted the rally across auto-related assets.
