'Suspension of cigar output will have no financial impact'

The Hyderabad-based VST Industries, which has suspended cigarette production in the wake of a government diktat on larger pictorial warnings, does not see any impact on its financial performance from the suspension.
The company, which manufactures cigarettes under brands as Charms, Charminar, Gold, Moments, said that "because of the prevailing ambiguity, the company has decided to suspend its production, temporarily awaiting clarity on the matter".
It added: "As of now, we do not anticipate any material impact on the financial performance of the company on account of the aforesaid temporary suspension of production."
From April 1, under a new government notification, tobacco products are required to carry larger pictorial warnings covering 85 per cent of the display area on packets.

On April 1, the Tobacco Institute of India (TII), which has leading members as ITC, Godfrey Philips and VST, had said factories of the companies would stop manufacturing.
"Owing to ambiguity on the policy related to revision of Graphic Health Warnings on tobacco product packs, the members are unable to continue manufacturing cigarettes from April 1, 2016," TII had said in a statement.
The companies, which are members of TII, account for more than 98 per cent of the country's domestic sales of duty-paid cigarettes.