The Union Budget was presented by the finance minister, Nirmala Sitharaman, on July 23. This budget was historic, as it marked the third Modi government and the 18th Lok Sabha's first full budget. And most importantly, Sitharaman's 7th consecutive budget.
No Additional Tax on Tobacco
All the focus is largely on what the FM said. But some also focused on the things that were not said by the FM. In her speech or in the documents that have been made available so far, Sitharaman did not mention or invoke an increase in taxes on tobacco or alcohol.
This development has ostensibly raised the expectation of business from tobacco companies, particularly ITC, formerly Indian Tobacco Company.
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The Kolkata-based company's shares that are listed on the NSE zoomed. The share price even gained over 4 per cent during the budget.
The company churned a gross revenue of about Rs 23,000 crore from the company's cigarette business. This translated to about 46 per cent of its total revenue from all of its products. | Photo: Pexels
Although the legacy company has diversified significantly over the past few decades, from luxury hotels to FMCG products, the company has expanded its footprints in different sectors. Despite this apparent expansion and diversification, the company continues to mint money from the smoke of cigarettes.
Not only does the company make a lot of money from the business, but it also has a significant hold in the tobacco market, competing with global brands like Philip Morris International (Marlboro).
ITC Shares Roar
In fact, according to data from Statistica, in 2022, which was barely 2 years ago, the company churned a gross revenue of about Rs 23,000 crore from the company's cigarette business. This translated to about 46 per cent of its total revenue from all of its products.
The company shares crossed the 4 per cent gain and dropped to 3 per cent, before again scaling back to a 4 per cent gain. At 14:29 IST, the company shares rose by 4.32 per cent or Rs 20.15, taking the overall value to Rs 486.70 per share. |
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According to the same data set, the company made around Rs 16,000 crore from its FMCG business, in 2022.
The company shares that started on a decent note slowly rose as the intraday day and the budget progressed. The company shares crossed the 4 per cent gain and dropped to 3 per cent, before again scaling back to a 4 per cent gain. At 14:29 IST, the company shares rose by 4.32 per cent or Rs 20.15, taking the overall value to Rs 486.70 per share.
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