Cigarette Stocks Plunge: New Excise Duty Hits ITC, Godfrey Phillips Hard on Budget Day
Business
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Moneycontrol•01-02-2026, 10:07
Cigarette Stocks Plunge: New Excise Duty Hits ITC, Godfrey Phillips Hard on Budget Day
- •ITC and Godfrey Phillips India shares experienced selling pressure, falling by about 1% in early trade on Budget day.
- •The decline is attributed to a new excise duty on cigarettes, effective from February 1, announced by the government.
- •The Central Excise (Amendment) Bill, 2025, passed last December, replaced temporary levies with a sharp increase in duty on tobacco products.
- •Excise duty, ranging from ₹2,050 to ₹8,500 per 1,000 sticks based on length, is now levied in addition to 40% GST.
- •Brokerage firm Prabhudas Lilladher lowered ITC's target price to ₹314, citing potential volume and profit impact due to increased cigarette prices.
Why It Matters: New excise duty on cigarettes, effective from Budget day, caused ITC and Godfrey Phillips shares to plunge.
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