Auto ancillary: Great boost for industry

What the Budget does

• Customs duty on steel melting and aluminium melting scrap reduced from 5% to 0%
• Reduction in excise duties in select segments of automobiles
• World-class skill development programme to be launched
• Dividend tax paid by parent company allowed to be set off against the same paid by its subsidiary

Impact on sector

• Customs duty exemption on select metal scrap might reduce the raw material cost for some of the auto component players
• Excise duty reduction in select auto segments will help spur demand for automobiles, which in turn will benefit the components industry
• Skill development programme will help address skilled labour shortage problem in the future

Impact on companies

• Customs duty exemption on raw materials such as steel and aluminium scrap is a positive for certain forgings and castings players like Bharat Forge [ Get Quote ] and Amtek Auto [ Get Quote ]
• Excise duty reduction on automobiles as well as the proposed world class skill development programme will help all the players in the industry

Also read: How Budget affects your stocks

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