Due to a significant block deal in the counter and the government’s announcement of increased taxes on cigarettes and tobacco products, shares of ITC Ltd. fell to their lowest point in almost two years on Thursday, January 1.
The decrease came after the Finance Ministry announced that starting on February 1, 2026, cigarettes, tobacco, and bidis would be subject to an effective 40% GST. Excise duty and National Calamity Contingent Duty (NCCD) are included in the new structure, along with the normal 28% GST rate. Market players are currently estimating the total tax burden on cigarettes after the amendments take effect, as well as if the move will result in any additional cess or duty.
A huge block trade that was completed earlier in the session, involving the exchange of over 4 crore shares of ITC, further damaged sentiment. Approximately 0.3% of the company’s outstanding equity was represented by the transaction. At an average price of almost Rs 400 per share, the total deal value came to Rs 1,614.5 crore.
For ITC, cigarettes continue to be a major source of revenue. The segment contributed about 48% of the company’s total revenue in the September quarter. Cigarette industry revenue increased 6.7% year over year to Rs 8,722 crore, while volumes jumped 6%. These results were generally consistent with market forecasts, which had predicted volume growth in the region of 5–6%.
On Thursday, January 1, 2026, the stock closed at Rs 363.85, down 9.71%. For the first time since 2020, ITC shares saw a 12% decline in 2025. The stock saw its biggest single-day plunge in almost eight months on Thursday, falling down to levels last seen in March 2024.
Godfrey Phillips India’s shares fell by around 17.08% on Thursday, closing at Rs 2,290.50 per on the NSE. Over the last five days, Godfrey Phillips India’s stock has dropped by over 12%, and over the last six months, it has down by about 16%. But in 2025, the stock increased by 48%. Its market capitalization is Rs 38,864 crore, and its P/E ratio is 43.45.
