Logistics shares extend gain on GST hopes

Gati, Snowman Logistics, Sical Logistics, VRL Logistics, Allcargo Logistics and Patel Integrated were up 1%-7% on BSE.

Shares of logistics companies extended gains for the fourth straight session in an otherwise weak market on hopes of clearance of the goods and services tax (GST) Bill in the upper house of the Parliament.

Gati, Snowman Logistics, Sical Logistics, Allcargo Logistics, Patel Integrated Logistics and VRL Logistics were up in the range of 1%-7% on the BSE. At 09:19 AM, the S&P BSE Sensex was down 0.21% at 26,706 points.

Thus far in current week, most of these stocks have rallied between 7%-18% as compared to 0.49% decline in the benchmark index.

According to media reports, a group of central and state government officials set up to frame the law for the proposed GST has submitted its final draft that could be taken up at a meeting of the empowered committee of state finance ministers next week.

Logistics is being looked as a major beneficiary amongst sectors. Sandeep Upadhyay, MD & CEO, Centrum Infrastructure Advisory Limited says that all those in logistic services will be beneficiaries while indirect impact may be seen for larger toll operators. The increased profitability of truckers, etc will drive traffic movement. Amongst logistics companies, Gati, Allcargo Logistics, Container Corporation of India, VRL Logistics, etc have seen surge in the stock prices and could see more gains as the street turns more bullish, the Business Standard report suggests. CLICK HERE TO READ FULL REPORT.