Puff of Growth: What's Ahead for India's Tobacco Giants Part 2

Regulatory & Policy Scenario No major increase in GST or tobacco cess is anticipated in FY25, which may further provide stability to the sector's operating environment. Source: Economic Times While health warnings and anti-smoking campaigns continue, they are unlikely to dent earnings materially, as core consumption remains sticky. Source: Edelweiss Research Stock Market Sentiment & Valuation Tobacco stocks like ITC continue to attract investors due to their defensive nature, high dividend yields (4–5%), and strong cash flow generation, making them attractive in volatile markets. Source: CNBC TV18 Valuation re-rating is possible if the FMCG demerger of ITC unlocks shareholder value, making tobacco stocks more attractive for long-term investors. Source: JM Financial Despite ESG concerns, institutional holding in cigarette companies remains stable, indicating continued market confidence in long-term profitability. Source: Moneycontrol