Indian tobacco stocks dip on reports on bills replacing compensation cess

ITC

01/12/2025 05:09

**Indian tobacco stocks ITC ITC.NS and Godfrey Phillips GDFR.NS  down 0.7% and 1%, respectively

** ITC trading at its lowest level since October 15

** Indian government to introduce two new bills in Parliament replacing the GST compensation cess on tobacco products, per reports

** Under the new bill, the proposed cess will be imposed on the "production capacity" of manufacturers to align taxation with manufacturing capability and to plug gaps created by variable production cycles, CNBC-TV 18 reports

** ICICI Securities says government indicated no major changes in the tax rate

** Adds that introduction of the new cess bill is likely to be tax neutral for ITC and other cigarette manufacturing companies

** YTD, ITC down ~12% while GDFR jumps 64%

 (Reporting by Urvi Dugar in Bengaluru)

 ((UrviManoj.Dugar@thomsonreuters.com;))