Evaluating the Impact of GST on the FMCG Sector: A Comparative Study of India and the USA (2013-2022)
This study explores the impact of the Goods and Services Tax (GST) on the Fast-Moving Consumer Goods (FMCG) sector in India, with a comparative analysis involving the USA from 2013 to 2022. The primary aim is to determine how macroeconomic variables such as the inflation rate and GDP growth rate of India and the USA (independent variables) influence the stock returns of major FMCG companies in India, including ITC, Britannia, Dabur, Emami, Colgate, Godrej, Hindustan Unilever, and Nestle (dependent variables). The research investigates whether the inflation and GDP growth rates of the USA have any significant effect on the stock returns of Indian FMCG companies, recognizing the interconnectedness of global economies and markets. The USA is chosen for comparison due to its mature FMCG market, distinct tax structure (sales tax instead of GST), and its influence on global economic trends, which can indirectly affect Indian markets through trade, investment, and supply chain linkages. By employing econometric models to analyze the relationship between these variables, the study provides insights into how GST, inflation, and GDP growth rates influence stock market performance in the FMCG sector. The findings highlight whether global economic conditions, particularly those of the USA, have any bearing on the stock returns of Indian FMCG firms, offering valuable implications for investors, policymakers, and businesses operating in these regions.
