Tax-led cigarette revenue surge masks weaker volumes and profits at India’s top makers
ITC’s reported cigarette revenue rose 73.7% to Rs 16,596.67 crore as higher taxes were passed through, but revenue excluding duty fell 31.45%. Godfrey Phillips and VST also reported lower underlying revenue and profit as the new GST-plus-excise regime lifted pack prices by about Rs 22–25.
India's biggest cigarette makers reported headline revenue growth driven by tax pass-through, while underlying revenue, profits and volumes declined after the new 40% GST-plus-excise regime. Companies raised prices and recalibrated portfolios to manage weaker demand and higher tax burdens.
Why this matters
The result extends ITC's recent pattern: prior signals showed cigarette volumes and profits falling after the tax hike, with Q1 underlying sales weakening at ITC, Godfrey Phillips and VST.
Retail-company signals are accelerating, up 222850% QoQ.