Tobacco stks get high on e-cig ban
Mumbai: Shares of cigarette companies rose sharply after the cabinet’s decision to ban ecigarettes. The scrips gained on the expectation that the ban would lead to higher sales of traditional cigarettes.
Cigarette stocks’s rise was led by the scrip of Godfrey Phillips India that jumped 5.5% and Golden Tobacco that climbed 4.7% on the BSE. Similarly, VST Industries rose by 3.4% and ITC gained 1%. Some analysts however said that the ban might be a pointer to a tougher stand against tobacco in future. Tobacco shares rose despite broader indices ending flat. The sensex closed 0.2% higher at 36,564.
While its rival tobacco companies have focused on cigarettes, ITC has diversified the most and generates a substantial portion of its topline from FMCG.