Force Motors Stock Falls 5.3% as GST Cuts Bypass Diesel-Heavy Portfolio

Mumbai, Thursday, September 4, 2025 – Force Motors Ltd (NSE: FORCEMOT, BSE: 500033) shares fell 5.3% to ₹18,725 in Thursday’s trading at 12:37 PM IST, even as the government rolled out a landmark GST overhaul that will be applicable from later this month. Investors balanced the company’s export struggles and the marginal gains of the tax reductions, considering its diesel-biased product lineup.

August Sales Snapshot

Force Motors registered sales of 2,403 units in August 2025, a 4.5% year-on-year increase. This is against 2,299 units sold during the same month last year. Domestic sales increased to 2,295 units, a 6.60% increase from 2,153 units in August 2024, indicating firm domestic demand. Exports, however, declined, with 108 units exported compared to 146 units a year earlier, down 26.02%.

GST Council’s Decision: Mixed Impact

Starting September 22, 2025, the GST Council will roll out a simplified structure with just two key slabs: 5% and 18%, while a special 40% rate will apply to premium cars, large UVs, SUVs, and motorcycles above 350 cc.

Under the revised framework, small cars (petrol up to 1200 cc, diesel up to 1500 cc, and length under 4,000 mm) will see tax reduced from 28% to 18%, making them more affordable. Similarly, three-wheelers, buses, goods carriers, and motorcycles up to 350 cc will also shift from 28% to 18%, offering a significant price relief.

On the other hand, mid and large cars, UVs, SUVs, and motorcycles above 350 cc, which earlier attracted 28% GST plus a compensation cess of around 45–50%, will now be subject to a flat 40% rate, streamlining the structure but keeping the luxury segment heavily taxed.

Most of Force Motors’ vehicles, including Traveller and Trax models, are diesel-powered with 2596 cc engines, placing them in the 40% GST slab. This means the company gains little from the tax rationalisation that otherwise benefits mass-market carmakers and two-wheeler manufacturers.

Force Motors Share Price Update

Force Motors shares are currently trading at ₹18,725, down 5.36% on September 4, 2025, at 12:37 PM IST. Force Motors shares have rallied 131% in the past year, 182% in the year-to-date, 161% in the past six months, and declined 5.31% in the past 5 days.

Force Motors started at ₹20,240 and went down to the same level of its intraday high, while falling to a session bottom of ₹18,550. The company has a market capitalisation of ₹24,650 crore. On the valuation front, the stock has a P/E of 28.64. It yields a dividend of 0.21%, with the latest quarterly distribution being ₹9.83 per share. Over the last year, Force Motors has seen a dramatic range in movement from a 52-week high of ₹21,990 to a 52-week low of ₹6,125.

Force Motors Ltd, based in Pune, manufactures Small and Light Commercial Vehicles, Utility Vehicles, and SUVs. The company is part of the Passenger Cars & Utility Vehicles segment and is listed on both NSE and BSE.

REF:https://www.nseindia.com/get-quotes/equity?symbol=FORCEMOT

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