ITC drops 15% in two days as cigarette tax overhaul spooks investors; Nuvama cuts to Hold
ITC shares slid ~15% after a tax shift replaced compensation cess with a sharply higher excise duty (BED up to Rs 4,000 per 1,000 sticks) on 69mm filter cigarettes. Nuvama downgraded to Hold and slashed its target to Rs 415 from Rs 534, flagging 30%+ higher tax incidence, likely 20% price hikes, demand destruction, and migration to the ~23% illicit market.
ITC shares fell ~15% after a cigarette tax shift replacing compensation cess with higher excise duty on 69mm filters. Nuvama downgraded to Hold, cutting target to Rs 415, warning of price hikes, demand destruction, and illicit-market migration.