Maruti Suzuki, Hyundai log best sales performance in years on the first day of GST rate cut

Expectations were running high in the automobile industry on September 22nd, which was not only the first day of Navratri but also the first day that the reduced GST rates took effect. The 56th GST Council meeting approved a reduction in the GST on small cars from 28% to 18% and replaced a dynamic GST and cess rate on SUVs, which had reached as high as 50%, with a flat GST rate of 40%, sans any cess.

The early signs of the revised GST rates have been more than encouraging. “The response from customers has been phenomenal—something we haven’t seen in the last 35 years,” said Partho Banerjee, senior executive officer, marketing and sales, Maruti Suzuki India Limited, the largest maker of passenger vehicles in India. “On the very first day, we recorded 80,000 enquiries, and have already delivered over 25,000 cars, with deliveries expected to touch 30,000 shortly.”

According to Banerjee, since September 18, when Maruti Suzuki announced an additional price reduction—over and above GST—it has received 75,000 bookings, with nearly 15,000 bookings coming in every day—about 50% higher than usual. “Demand for small cars has been especially strong, with bookings growing by nearly 50%. Enquiries remain very high, and we may even run out of stock for certain variants,” he said. Maruti Suzuki dealers are also staying open late into the night to deliver cars to customers. “Compared to last year, the overall response has been exceptionally strong.”

The optimism surrounding the GST rate cuts was also seen on the bourses, as Maruti Suzuki crossed the elusive ₹5 lakh crore market capitalisation on Tuesday. The country’s most valued auto stock has zoomed over 11% in the past month, outperforming the BSE Auto Index, which gained 7.5% during this period. The stock has been trading 1.79% higher at ₹16,099 apiece.

South Korean carmaker Hyundai Motor India Limited recorded approximately 11,000 dealer billings, its highest single-day performance in the last five years. “The auspicious start of Navratri, amplified by the momentum from GST 2.0 reforms, has infused strong positivity into the market. This is a clear testament to robust festive sentiment and customer confidence,” said Tarun Garg, COO, Hyundai Motor India. “Looking ahead, we anticipate sustained festive demand and remain committed to delivering value and excitement to our customers.”

Hyundai Motor India shares were trading 0.59% lower at ₹2,705.70 apiece.

Homegrown carmaker Tata Motors reported a notable performance on the first day of the festive season, following the implementation of the GST 2.0 rate cuts. “Tata Motors records 10,000 deliveries and more than 25,000 enquiries on day one of Navratri, marking a strong start to the festive season,” the carmaker said in a statement.

Tata Motors has been a laggard among its peers, delivering just a 2% increase in the past month, amid concerns over a cyberattack on its U.K. subsidiary, Jaguar Land Rover (JLR), which disrupted production. Tata Motors shares were trading 0.68% higher at ₹701 apiece.

Market analysts say the rally in the auto sector is broad-based, driven by renewed investor confidence, expectations of streamlined tax structures, and stronger consumer demand.

“The GST rate cut has been implemented from 22nd Sep 2025, and with automotive companies passing on the benefits to the end customer, automobiles in most segments have become cheaper. We believe multiple initiatives by the government, including GST cuts, will drive auto demand,” said Arun Agarwal, VP-Fundamental Research, Kotak Securities.