You are here: Home » Budget » News » Industry
Business Standard

Budget 2015: Bad news for ITC

25% increase in 65 mm cigarettes and 15% in other categories

BS Reporter  |  Kolkata 

Finance Minister Arun Jaitley has proposed a 25% increase in 65 mm cigarettes and 15% in other categories, which is more than what the market had anticipated.

Market leader, ITC's stock tumbled 8% on news of the steep hike. According to analysts, the excise increase was estimated to increase by 10%..

Read our full coverage on Union Budget



Historically, the excise increase since 1997-2000 has been around 200 bps more than inflation. Since 2011, however, the increase has been at CAGR of 13% more than inflation, which led to lower excise collections in the December quarter.

However, what brought some relief to the company was that there was no announcement on ban on loose cigarettes. Loose cigarettes constitute around 70% of cigarettes sold in India and regulating it would have been near impossible as it involves monitoring 7-8 million outlets that retail cigarettes.

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Sat, February 28 2015. 14:00 IST
RECOMMENDED FOR YOU