ITC Falls 8% After Budget as Government Hikes Excise Duty

ITC Falls 8% After Budget as Government Hikes Excise Duty
Shares in cigarette makers fell on Saturday after the budget raised excise duty on cigarettes by 25 per cent for cigarettes of length not exceeding 65 mm, and by 15 per cent for cigarettes of other lengths.
 
ITC Ltd slumped  8.2 per cent to close at Rs 361 while VST Industries lost 4 per cent to Rs 1680.
 
Although cigarette demand is relatively inelastic, analysts have said higher taxes would hurt volume growth and force companies to diversify faster.

ITC has the maximum weightage on the Sensex and Nifty.
 
© Thomson Reuters 2015