The Indian government announced a sharp increase in cigarette consumption tax. Affected by this, the stock price of Indian Tobacco once plummeted 7.9%, the biggest one-day decline since March 2020. The stock's trading volume reached 8 times the three-month full-day average. The stock price of its counterpart Godfrey Phillips also fell sharply by 11% at one point. Jefferies analysts led by Vivek Maheshwari wrote in the research report: “Although we are uncertain whether this is the final tax policy, judging from the current situation, it is extremely likely that this policy will be implemented.” According to Jefferies's analysis, there are still many uncertainties, but estimates show that if the national disaster emergency tax maintains the current levy standards, the current consumption tax increase may exceed 30%; even if the national disaster emergency tax is included in the unified accounting of the new tax system, the increase in tax burden will still far exceed 20%. Maheshwari said, “Although the final policy results have yet to be settled, once approved and implemented, it will definitely have a significant negative impact on the industry — cigarette sales may be impacted, and at the same time, market concerns suggest that part of the sales volume may be diverted from the illegal cigarette market.”

The Indian government announced a sharp increase in cigarette consumption tax. Affected by this, the stock price of Indian Tobacco once plummeted 7.9%, the biggest one-day decline since March 2020. The stock's trading volume reached 8 times the three-month full-day average. The stock price of its counterpart Godfrey Phillips also fell sharply by 11% at one point. Jefferies analysts led by Vivek Maheshwari wrote in the research report: “Although we are uncertain whether this is the final tax policy, judging from the current situation, it is extremely likely that this policy will be implemented.” According to Jefferies's analysis, there are still many uncertainties, but estimates show that if the national disaster emergency tax maintains the current levy standards, the current consumption tax increase may exceed 30%; even if the national disaster emergency tax is included in the unified accounting of the new tax system, the increase in tax burden will still far exceed 20%. Maheshwari said, “Although the final policy results have yet to be settled, once approved and implemented, it will definitely have a significant negative impact on the industry — cigarette sales may be impacted, and at the same time, market concerns suggest that part of the sales volume may be diverted from the illegal cigarette market.”