Budget and Auto Sector

02 Feb, 2023 |
11:25 AM

Scrappage of old govt vehicles and ambulances, and replacement with new ones positive for PV industry.
Customs duty exemption on import of capital goods and machinery required for manufacture of lithium-ion cells (EV batteries).
FAME budget increased from Rs29bn in FY23 to Rs52bn in FY24.

To support 4,090 buses, 15,000 cars, 100,000 3Ws, 320,000 2Ws in FY24.
While the increase in FAME allocation is positive, number of vehicles targeted to be supported (especially PV, 2W) is very small in the context of industry size.
Budget includes allocation for setting up charging stations.

Slight increase in duty on import of vehicles (CBU up from 60% to 70%; SKD up from 30% to 35%).

Analysts of IIFL Securities believe positive impact of the budget announcements on the auto sector.

Ad Image