ITC drops 15% in two days as cigarette tax overhaul triggers Nuvama downgrade
A shift from compensation cess to sharply higher Basic Excise Duty (Rs 5 to Rs 4,000 per 1,000 sticks) lifts tax incidence 30%+, forcing an estimated 20% price hike. Nuvama cut ITC to 'Hold' with target slashed to Rs 415 from Rs 534, warning of volume compression and illicit-market gains.
ITC fell ~15% in two days after cigarette tax overhaul replaced compensation cess with sharply higher Basic Excise Duty. Nuvama downgraded to 'Hold', cut target to Rs 415, warning of price hikes, volume compression, and illicit-market shift.