MSTC share price jumps 17% on Cabinet scrappage plan 2026

Market context: MSTC bucks broader weakness

MSTC Ltd shares outperformed the broader market on Thursday as traders reacted to the Union Cabinet’s clearance of a vehicle scrappage incentive scheme focused on Delhi-NCR. The stock surged as much as 17 per cent in intraday trade, even as the wider market tone was described as weak. In early action, MSTC opened at ₹449 on the National Stock Exchange (NSE). It then rallied sharply to an intraday high of ₹523.75. By around 1 PM, the stock was still up about 15 per cent at ₹512.50. MSTC also featured among the top gainers on the exchange during the session.

MSTC share price movement through the session

Multiple snapshots from the trading day showed sustained strength in MSTC’s price action. At 10:30 am, MSTC was up 14.72 per cent at ₹512.15. At 11:30 am, it was reported to be up as much as 17.31 per cent and later trading 12.95 per cent higher at ₹504.25. Separately, another update noted the stock had moved up by about 15.2 per cent from a previous close of ₹446.45, with a last traded price around ₹514.3. Another price point referenced for the day was ₹507.75. These numbers highlight a volatile but clearly positive session for the stock.

What the Cabinet approved and why it matters

The Union Cabinet, chaired by Prime Minister Narendra Modi, approved an incentive scheme aimed at replacing older commercial vehicles operating in the Delhi-NCR region. The stated policy goal is to reduce vehicular emissions and improve air quality by accelerating the phase-out of BS-IV and older trucks and buses. Under the plan, vehicle owners will be incentivised to replace older vehicles with BS-VI-compliant models or electric vehicles (EVs). The scheme is expected to drive organised vehicle scrappage and boost demand for recycling and scrap disposal services. Market participants linked this expected activity increase to companies active in scrap auctions and metal trading.

Who is covered: vehicles and geographies

Government estimates cited in the reports put the beneficiary base at around 2.07 lakh vehicle owners. This includes about 1.91 lakh trucks and 16,329 buses. The scheme spans Delhi as well as parts of Haryana, Rajasthan and Uttar Pradesh covered in the Delhi-NCR framework referenced in the reports. The focus is on older, more polluting commercial vehicles, particularly those complying with BS-IV or earlier emission norms. The coverage size matters because it points to potential volumes in scrappage and replacement cycles.

Incentives: financing support, fuel vouchers, and EV benefits

The Centre’s package includes a 5 per cent interest subsidy on loans for a period of five years to support replacement purchases. Vehicle owners are also expected to receive monthly fuel vouchers of up to ₹4,800, with the value depending on vehicle category. These fuel vouchers are to be provided for five years through oil marketing companies, as reported. The scheme also includes one-time benefits for purchasing electric vehicles or for trading certificates of deposit. The incentive structure, as described, is designed to lower both financing and operating costs during the transition.

Compliance rules: scrapping, sale outside NCR, and eligibility

Eligibility conditions differ by the emission category of the existing vehicle. Under the scheme details reported, owners of BS-III and older vehicles will be required to scrap vehicles at registered scrapping facilities. BS-IV vehicles can either be scrapped or sold outside the NCR in non-NCAP cities and towns, based on the versions cited. Another condition mentioned is that to avail the benefits, eligible owners must purchase and register a BS-VI-compliant or electric vehicle within NCR. The reports also refer to authorised Registered Vehicle Scrapping Facilities (RVSFs) as the channel for compliant scrapping.

State support and manufacturer discounts

State governments participating in the initiative are expected to waive registration fees and offer motor vehicle tax concessions. One report highlighted a 100 per cent concession on motor vehicle tax and a waiver of registration fees for newly purchased BS-VI or electric vehicles. For owners opting for used BS-VI vehicles, a 50 per cent concession on these charges was cited. Incentives were also described as remaining valid for a period of 10 years in one version of the coverage. In addition, automobile manufacturers were reported to provide an 8 per cent discount on ex-showroom prices.

Why MSTC and MMTC moved: link to organised scrappage

Investor interest in MSTC and MMTC was tied to expectations of higher organised scrappage volumes and scrap generation. MSTC is a Miniratna Category I PSU under the administrative control of the Ministry of Steel. It auctions ferrous and non-ferrous scrap, end-of-life vehicles and surplus assets for government departments, defence establishments and public sector undertakings. With a policy-driven push for scrapping older commercial vehicles, the market connected the move to potentially higher auction and disposal activity through organised channels. MMTC, described as another scrappage-focused stock in the reports, was also bought on the same theme.

MMTC also rallies alongside MSTC

MMTC shares rose strongly during the session. At 10:30 am, MMTC climbed 6.97 per cent to ₹69.72. Another update put MMTC up about 7.01 per cent to ₹69.75. A separate line noted MMTC had risen 8.09 per cent, alongside MSTC’s jump of 14.06 per cent, reflecting varying intraday readings from different timestamps. The common driver across these updates was the Cabinet-approved replacement incentive scheme and the anticipated increase in organised recycling and scrappage services.

Key numbers at a glance

Additional policy signal: draft vehicle scrapping rules

Separate coverage also referenced a later policy-related development where the Ministry of Road Transport and Highways (MoRTH) issued a draft notification on Vehicle Scrapping Rules and invited suggestions within a 30-day public consultation period. In that context, MSTC shares were reported to have surged nearly 8 per cent to ₹479.85 on a Sunday session mentioned in the material. While distinct from the Cabinet-approved Delhi-NCR incentive package, the draft rules update kept attention on companies associated with vehicle scrappage activity.

Conclusion: a policy-driven rally with clear triggers

MSTC and MMTC shares rose sharply as investors reacted to the Cabinet’s Delhi-NCR vehicle replacement incentive scheme, with MSTC hitting an intraday high of ₹523.75 after opening at ₹449. The programme’s ₹9,585 crore outlay, target base of about 2.07 lakh vehicle owners, and defined incentives such as a 5 per cent interest subsidy and fuel vouchers shaped expectations around organised scrappage demand. MSTC’s role in auctions of scrap and end-of-life vehicles explains why the stock was closely linked to the policy announcement. Next cues for the market will come from implementation details and execution steps by the Centre and participating states, based on the incentive structure outlined in the reports.