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ITC, other tobacco stocks fall up to 8% after excise duty hike pushes cigarette prices higher
Last Updated: 2nd February 2026 - 03:37 pm
Summary:
Shares of ITC, Godfrey Phillips India, and VST Industries declined up to 8% on February 2 after cigarette prices were raised following an excise duty increase. Premium cigarette packs saw price hikes of ₹22–₹55, triggering concerns over demand and margins in the tobacco segment.
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Tobacco stocks came under pressure on Monday after cigarette prices were raised following the implementation of higher excise duty.
ITC shares declined up to 2.4%, while Godfrey Phillips fell as much as 8% and VST Industries slipped 2.7% in intra-day trade. The decline marked the second straight session of losses for the stocks.
The government had imposed an additional excise duty on cigarettes earlier in January, effective February 1, leading to higher retail prices across categories.
According to a report by Press Trust of India, premium cigarettes of 76 mm length will now cost between ₹50 and ₹55 more per pack of 10 sticks, depending on the brand.
A pack of Wills Navy Cut, earlier priced at ₹95, is expected to cost around ₹120. Other brands in the 84 mm category, including Gold Flake Lights and Wills Classic, are expected to be priced between ₹220 and ₹225 per pack.
Quarterly numbers
Godfrey Phillips reported an 8.5% year-on-year rise in consolidated net profit to ₹343 crore for the December quarter. Revenue from operations increased 15% to ₹1,829 crore.
VST Industries posted a 56% decline in consolidated net profit to ₹60 crore, while revenue stood at ₹373 crore, largely unchanged year-on-year.
ITC reported consolidated net profit of ₹5,018 crore, compared with ₹5,013 crore a year earlier. Revenue from operations rose 6.7% to ₹21,706 crore.
The cigarette segment accounted for about 47% of ITC’s consolidated revenue during the quarter.
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