Modi's Diwali Dhamaka: 5 stocks to watch out for as govt plans GST reforms

Stocks such as Maruti Suzuki, TVS Motor, Blue Star, Johnson Controls and JK Cement can rally up to 26% as the government plans 2-tier GST reforms ahead of Diwali 2025.

Equity markets in India were seen trading on an upbeat note on Monday following Prime Minister Narendra Modi's next-Gen GST reforms plan by Diwali 2025.  Modi in his Independence Day speech on August 15 spoke about a Diwali 'Dhamaka' (bonanza) for the masses by way of a structural overhaul of the goods and services tax (GST).  The government has proposed a two-tier GST with 5 per cent and 18 per cent slabs, along with a 40 per cent slab for a few items in the sin goods category. Products across auto, cement and electronics are likely to attract lower GST rates, as they move out from the 28 per cent GST slab. READ ITEMS LIKELY TO GET CHEAPER  Shares of auto, cement and electronics apart from consumer goods rallied up to 10 per cent in intra-day deals on Monday. Auto stocks, Mahindra & Mahindra, Maruti and Eicher Motors hit new life-time highs. READ MORE  Given this background, here are 5 stocks to watch out for across electronics (air conditioners), auto and cement sectors that can potentially rally up to 26 per cent from here as per technical charts. 

5 stocks to focus on ahead of GST reforms

Maruti Suzuki India

Current Price: ₹13,870  Likely Target: ₹16,500  Upside Potential: 19%  Support: ₹13,400; ₹12,950  Resistance: ₹14,030; ₹14,950; ₹15,950  With today's 8 per cent intra-day rally, Maruti stock has given a fresh breakout on the daily chart. The stock is likely to trade on an upbeat note as long as it quotes above ₹13,400 levels, with overall bias to remain favourable above ₹12,950 levels. 

    On the upside, the stock can potentially zoom towards ₹16,500 levels, hints the yearly Fibonacci chart. The stock may face interim resistance around ₹14,030, ₹14,950 and ₹15,950 levels. 

TVS Motor Company

Current Price: ₹3,232  Likely Target: ₹3,870  Upside Potential: 19.7%  Support: ₹3,120; ₹3,030  Resistance: ₹3,454; ₹3,700  TVS Motor is likely to trade with a bullish bias as long as the stock holds above ₹3,120 levels; below which the key support stands at ₹3,030 levels. On the upside, the stock can potentially soar to ₹3,870 levels, with intermediate resistance anticipated around ₹3,454 and ₹3,700 levels. 

 

 

Blue Star Company

Current Price: ₹1,917  Likely Target: ₹2,250  Upside Potential: 17.4%  Support: ₹1,842  Resistance: ₹2,020  Blue Star stock is seen witnessing a fresh breakout on the daily chart; a daily close above ₹1,842 shall confirm the same. On the upside, the stock seems on course to test the weekly trend line hurdle at ₹2,020 levels. Break and sustained trade above the same can trigger a rally towards ₹2,250 levels. 

 

 

Johnson Controls - Hitachi Air Conditioning India

Current Price: ₹1,744  Likely Target: ₹2,200  Upside Potential: 26.2%  Support: ₹1,711; ₹1,695  Resistance: ₹1,770; ₹1,800; ₹1,915; ₹2,020  Apart from finding support around its 100-DMA, which stands at ₹1,711 levels, Johnson Controls has also witnessed the formation of 'Golden Cross' on the daily chart; wherein the 50-DMA has crossed over the 200-DMA. 

 

  Going forward the stock is likely to exhibit a positive bias with a likely target around ₹2,200 levels. Intermediate resistance for the stock can be anticipated around ₹1,770, ₹1,800, ₹1,915 and ₹2,020 levels. The key support on the downside stands at ₹1,695 levels. 

JK Cement

Current Price: ₹7,245  Likely Target: ₹8,430  Upside Potential: 16.4%  Support: ₹7,100; ₹6,900; ₹6,700  Resistance: ₹7,550; ₹7,925  JK Cement has witnessed a strong rally since the breakout in mid-March, wherein the stock has surged by 63 per cent in the last five months. 

 

  The long-term chart shows that the stock has been trading above the higher-end of the Bollinger Bands on the monthly scale for the fourth straight month. The key momentum oscillators remain favourably placed on the charts, thus hinting towards further upside for the stock.  On the upside, the stock can jump to ₹8,430 levels, with interim resistance likely around ₹7,550 and ₹7,925 levels. Bias at the counter is likely to remain positive as long as the stock sustains above ₹6,700 levels, with near support visible around ₹7,100 and ₹6,900 levels.