GODFRYPHLP

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By Ujjaini Dutta

BENGALURU, Jan 12 (Reuters Breakingviews) - Sometimes smokers are hit with a compelling reason to quit. India imposed fresh taxes on cigarettes last month, knocking as much as 17% off the shares of British American Tobacco BATS.L-backed $47 billion ITC ITC.NS and Godfrey Phillips India GDFR.NS which makes and sells Marlboro cigarettes under license with Philip Morris International PM.N. Foreign ownership limits and a ban on vaping had already dented the appeal of a market with 253 million tobacco users. The latest tax jolt is another nail in the coffin for overseas investment in the country.

Around the world, tobacco majors are shifting their focus to alternative products like e-cigarettes on the expectation that cigarette volumes will continue to decline on health concerns and tougher regulations. India's 2019 ban on e-sticks and heated tobacco products makes such a shift difficult for companies in the world's fifth-largest economy. The new excise duty only worsens the outlook.

Tobacco companies are well used to being slapped with sin taxes when government revenues need patching up. Smokes were already subject to a 40% levy following a rejig of goods and services taxes last year. The latest hike pushes the total tax on cigarettes to about 50%, according to brokerage Motilal Oswal. Analysts responded by revising down ITC's expected cigarette sales 13% lower for the next two full financial years, per S&P Global. Rather than quitting, though, most customers will simply downtrade to illicit smokes available in the black market.

Little wonder that BAT has been paring its stake in ITC, despite its 75% share by units of India's formal cigarette market. It has trimmed its 30% holding down to 23% over the past two years, joining other multinational companies in disposing their highly valued equity interests in the country to raise funds for their global business. Despite the tax hit, ITC trades on a rich 21 times one-year forward earnings, twice BAT's multiple, according to LSEG data. Indian cigarette makers are also less profitable, with ITC's net margin trailing its foreign partner's by four percentage points and Godfrey Phillips' roughly half, per Visible Alpha.

Smoking isn't good for you. India is succeeding in making it undesirable, even for corporations who are addicted to the stuff.

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CONTEXT NEWS

India will levy an additional excise duty on cigarettes in the range of 2,050 to 8,500 rupees ($22.8 to $94.5) per 1,000 sticks, depending on length, the finance ministry announced late on December 31. The revised dues will take effect on February 1. The new tax will apply in addition to an existing 40% Goods and Services Tax.

Shares of India’s ITC, the $47 billion conglomerate backed by British American Tobacco, fell as much as 9.7% on January 1, while Godfrey Phillips India, the distributor of Marlboro in the country, dropped 17%.

(Editing by Una Galani and Antony Currie; Production by Aditya Srivastav)

((For previous columns by the author, Reuters customers can click on DUTTA/[email protected]))

Adds brokerage comment in paragraph 6; updates shares

Jan 1 (Reuters) - Shares of Indian tobacco companies slumped on Thursday after the government imposed a new tax on cigarettes, making them costlier for an estimated 100 million smokers in the world's most populous country.

ITC ITC.NS, maker of Gold Flake and the market leader, fell 9.2%, while Godfrey Phillips India GDFR.NS, the distributor of Marlboro in the country, tanked 14.1%.

Shares of ITC were trading at 365.50 rupees, their lowest level since April 2023, and were also on track for their worst day in nearly six years. Godfrey Phillips was set for its steepest fall since November 2016.

ITC was the biggest loser on the Nifty 50 index .NSEI and also led declines on the FMCG index .NIFTYFMCG, which was trading 3.2% lower.

India's finance ministry late on Wednesday notified an excise duty of 2,050–8,500 rupees ($22.82–$94.60) per 1,000 sticks, depending on cigarette length, effective February 1.

Jefferies analysts called the move "a clear negative," saying it would hurt sales volumes and revive concerns about losing share to the illicit industry.

Health issues tied to smoking are seen as a major drain on India's resources, and the government has introduced steps, including larger warning labels and periodic tax adjustments, to curb consumption.

While the government has not specified the impact of the duty change on retail prices, analysts say higher taxes could prompt companies to raise prices.

The duty translates into a 22%-28% increase in overall costs for 75-85 mm cigarettes, analysts at ICICI Securities said.

"Cigarettes longer than 75 mm account for roughly 16% of ITC's volumes and are likely to see price increases of 2–3 rupees per stick as a result of the levy," they said.

The new tax will apply in addition to the existing 40% Goods and Services Tax, the order showed.

($1 = 89.8510 Indian rupees)

(Reporting by Kashish Tandon in Bengaluru; Editing by Rashmi Aich)

(([email protected]; 8800437922;))

Adds background, details from paragraph 2

NEW DELHI, Dec 31 (Reuters) - India has imposed an excise duty on cigarettes in a range of 2,050-8,500 rupees ($22.8-$94.5) per thousand sticks based on the length of the products, effective February 1, the finance ministry said in an order late on Wednesday.

The move could increase prices of cigarettes for an estimated 100 million smokers in the world's most populous country.

In December, the Indian government approved a new law - the Central Excise (Amendment) Bill 2025 - that replaces a temporary levy on cigarettes and tobacco products.

The excise duty would be imposed on cigarettes in addition to a 40% goods and services tax, the order issued late on Wednesday showed.

Total taxes on cigarettes in India currently make up about 53% of retail prices, well below the World Health Organization benchmark of 75% aimed at discouraging consumption. This includes a 28% goods and services tax and additional value based levy based on the size of the cigarettes.

The higher levies could impact sales of cigarettes manufacturers like ITC ITC.NS and Godfrey Phillips India GDFR.NS.

(Reporting by Nikunj Ohri, Chris Thomas; editing by Diane Craft)

(([email protected]; +91 90284 60730; Reuters Messaging: twitter.com/nikunj_ohri))

** Shares of Godfrey Phillips India GDFR.NS fall 1.9% to 3,277.70 rupees

** Cigarettes maker said on Friday a major fire broke out in a third-party's tobacco processing plant and warehouse in Andhra Pradesh, where GDFR processes and stores tobacco leaf inventory

** Co assessing actual damage caused by fire; inventory adequately covered by insurance

** GDFR up ~88% YTD

(Reporting by Vijay Malkar)

(([email protected];))

July 28 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• BOARD TO CONSIDER ISSUE OF BONUS EQUITY SHARES IN 2:1 RATIO

Source text: ID:nBSE2wkYD2

Further company coverage: GDFR.NS

(([email protected];))

May 15 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• MARCH-QUARTER CONSOL NET PROFIT 2.79 BILLION RUPEES

• MARCH-QUARTER CONSOL TOTAL REVENUE FROM OPERATIONS 18.88 BILLION RUPEES

• DIVIDEND 60 RUPEES PER SHARE

Further company coverage: GDFR.NS

(([email protected];))

April 9 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• GETS TAX ORDER IMPOSING PENALTY OF 15.6 MILLION RUPEES

Source text: ID:nNSE1Bt1KW

Further company coverage: GDFR.NS

(([email protected];;))

March 4 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• RECEIVES ADMINISTRATIVE WARNING FROM SEBI

• SEBI ALLEGES VIOLATION OF MULTIPLE REGULATIONS

Source text: ID:nNSE6QyL8z

Further company coverage: GDFR.NS

(([email protected];;))

** Shares of cigarette manufacturer Godfrey Phillips India GDFR.NS up 8.41% at 5,420 rupees

** Marlboro cigarette distributor's Q3 profit rises 48.7%

** Co reports a 28% rise in revenue, led by higher sales in its cigarettes segment, which offset steep decline in convenience store sales

** Including session's gains, stock has more than doubled in value in last 12 months

(Reporting by Ananta Agarwal in Bengaluru)

(([email protected]))

Feb 4 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• GOT TAX ORDER CONFIRMING DEMAND OF 703.4 MILLION RUPEES

Source text: ID:nBSE9JPZ7G

Further company coverage: GDFR.NS

(([email protected];;))

Jan 29 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• GETS TOTAL GST DEMAND ORDER FOR 73.2 MILLION RUPEES

Source text: ID:nBSE4QyT32

Further company coverage: GDFR.NS

(([email protected];;))

Dec 24 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• TWENTY FOUR SEVEN RETAIL STORES FILES SUIT AGAINST CO FOR ROYALTY

• SUIT ASKS FOR ROYALTY, DAMAGES OF 20 MILLION RUPEES

Source text: ID:nBSE8NsP7N

Further company coverage: GDFR.NS

(([email protected];))

Dec 3 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• GODFREY PHILLIPS INDIA LTD - CLARIFIES ON REPORT GST PANEL SUGGESTS 35% TAX FOR CIGARETTES, TOBACCO

• GODFREY PHILLIPS INDIA LTD - NOT AWARE OF MEETING OF GROUP OF MINISTERS IN REPORTS

Source text: [ID:]

Further company coverage: GDFR.NS

(([email protected];))

** Shares of VST Industries VSTI.NS up 2.3% to 322 rupees, set for their best day in November

** Co, which manufactures cigarettes, has sold 2.7 acres of land for 1.02 billion rupees ($12 million)

** VSTI up 4% YTD, lagging peers Godfrey Phillips India's GDFR.NS and NTC Industries' NTCI.BO, which have risen 173% and 142%, respectively

($1 = 84.2725 Indian rupees)

(Reporting by Nishit Navin)

(([email protected];))

Nov 11 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• SEPT-QUARTER CONSOL NET PROFIT 2.48 BILLION RUPEES

• SEPT-QUARTER CONSOL TOTAL REVENUE FROM OPERATIONS 16.51 BILLION RUPEES

• INCORPORATION OF UNIT FOR REAL ESTATE DEVELOPMENT

• NAMES VISHAL DHARIWAL AS CFO

Source text: [ID:]

Further company coverage: GDFR.NS

(([email protected];;))

** Shares of Godfrey Phillips India GDFR.NS rise as much as 10.7% to hit record high at 7,095 rupees

** Marlboro cigarettes maker says it will consider issuing bonus shares in 2:1 ratio in board meeting on Sept. 20

** Trading vol is 1.9x 30-day avg

** Stock up 8% so far this week, on track for five straight weeks of gains

** GDFR last up 9.5%, bumping YTD gains to ~232%

(Reporting by Ashish Chandra in Bengaluru)

(([email protected] (+91 7982114624))

** Shares of Godfrey Phillips India GDFR.NS down 3.6% at 6400.1 rupees

** Marlboro cigarettes maker finalises agreement to sell retail business, per CNBC-TV18

** Aims to complete sale by end of September, report says

** Sale was opposed by a board member, report adds

** Retail business formed 4.3% of gross sales in FY24

** Despite day's fall, stock is up more than 3-fold so far this year

(Reporting by Nandan Mandayam in Bengaluru)

(([email protected]; Mobile: +91 9591011727;))

Aug 7 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• JUNE-QUARTER CONSOL NET PROFIT 2.29 BILLION RUPEES

• JUNE-QUARTER CONSOL TOTAL REVENUE FROM OPERATIONS 14.41 BILLION RUPEES

Source text for Eikon: [ID:]

Further company coverage: GDFR.NS

(Reporting by VijayDattaram Malkar)

(([email protected];))

** Shares of Marlboro cigarette-maker Godfrey Phillips India Ltd GDFR.NS rise as much as 18.1% to record 4,789.85 rupees

** Over 53,800 shares change hands in block deals at a 11.7%-17.8% premium to previous closing price of 4,057.10 rupees - National Stock Exchange of India data

** Stock's previous block deal had happened in March, per BSE data

** In total, more than 1.6 mln shares traded in stock's second-busiest day in 2024 vs 30-day avg volume of 99,266 shares

** Stock up 2.2x this year – better than ITC ITC.NS, which has barely changed this year, and VST Industries' VSTI.NS 24% rise

(Reporting by Nandan Mandayam in Bengaluru)

(([email protected]; Mobile: +91 9591011727;))

June 10 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• GETS ORDER WITH PENALTY OF 4.6 MILLION RUPEES FROM OFFICE OF DEPUTY COMMISSIONER, CGST

Source text for Eikon: ID:nBSE5n2Kgy

Further company coverage: GDFR.NS

(([email protected];;))

** Shares of tobacco maker Godfrey Phillips India GDFR.NS down 2.6% at 3,782.9 rupees; stock among few losers amid jump in broader markets .BO

** Executive director Samir Modi lodged complaint with Delhi Police against his mother, Bina Modi, her personal security officer and co's directors over assault, as per Economic Times report

** A Godfrey Phillips spokesperson rejected the accusation, according to the report. "These allegations are entirely false and atrocious," the person said.

** Godfrey Phillips India did not immediately respond to Reuters' request for comment

** Stock on track to log biggest one-day drop in nearly a month

** Session's losses trim YTD gains to ~80%

(Reporting by Manvi Pant in Bengaluru)

(([email protected]; +918447554364;))

May 2 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• SIGNED A PRODUCT SUPPLY AGREEMENT WITH FERRERO INDIA

• CO TO PURCHASE PRODUCTS FROM FERRERO AND RE-SELL THE SAME

Source text for Eikon: ID:nBSEc4X28n

Further company coverage: GDFR.NS

(([email protected];))

April 30 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• GETS ORDER FROM OFFICE OF COMMISSIONER, CENTRAL GST (APPEALS) WITH PENALTY OF 5.1 MILLION RUPEES

Source text for Eikon: ID:nNSE29jxpK

Further company coverage: GDFR.NS

(([email protected];;))

April 12 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• DECIDED TO EXIT FROM CARRYING OUT BUSINESS OPERATIONS OF ITS RETAIL BUSINESS DIVISION

• REVENUE FROM OPERATIONS FOR RETAIL BUSINESS DIVISION FOR FY 22-23 WAS 3.96 BILLION RUPEES, 9.3% OF TOTAL

• RETAIL BUSINESS DIVISION HAD NEGATIVE NET WORTH AS ON MARCH, 31 2023

Source text for Eikon: ID:nBSE1y0rQk

Further company coverage: GDFR.NS

(([email protected];))

Jan 29 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• GODFREY PHILLIPS INDIA DEC-QUARTER CONSOL NET PROFIT 2.12 BILLION RUPEES VERSUS 1.99 BILLION RUPEES

• GODFREY PHILLIPS INDIA DEC-QUARTER CONSOL TOTAL REVENUE FROM OPERATIONS 14.88 BILLION RUPEES VERSUS 11.12 BILLION RUPEES

Source text for Eikon: [ID:]

Further company coverage: GDFR.NS

(([email protected];))

BENGALURU, Nov 3 (Reuters) - Cigarette maker Godfrey Phillips India GDFR.NS on Friday reported its first drop in quarterly pre-tax profit in two years, weighed by a sharp rise in expenses.

Shares of the company slid 9.2% after the results in their biggest intraday drop since December.

The company, which manufactures and distributes Marlboro cigarettes under a license agreement with Philip Morris International PM.N, said profit before tax in the second quarter fell 8.2% to 2.19 billion rupees, as expenses surged nearly 20%.

Total revenue from operations rose 15.4% to 13.75 billion rupees, with revenue from its profitable division which sells cigarettes, tobacco and related products climbing 16.6%.

Revenue from its round-the-clock convenience store, 24Seven, and confectionary sales grew 4.3% to 1.17 billion rupees, but recorded a pre-tax loss of 158.9 million rupees.

Shares of the company had risen nearly 30% in the quarter, a opposed to a 1.6% fall in rival ITC ITC.NS, which also makes consumer goods.

($1 = 83.2400 Indian rupees)

(Reporting by Chris Thomas in Bengaluru)

(([email protected];))

** Shares of cigarettes manufacturer Godfrey Phillips India GDFR.NS up as much as 14.59% to 1,975 rupees, their highest since March 20

** Co hits sharpest intraday pct gain since April 11, 2022, on track for fourth consecutive session of gains if trends hold

** GDFR said its consolidated net profit for the quarter ended June 30 rose nearly 79% to 2.54 billion rupees ($31.01 million)

** About 481,152 shares change hands as of 9:30 a.m. IST, vs 6.9x 30-day average of 70,039 shares

** Stock down 12.9% YTD, as of last close

($1 = 81.9217 Indian rupees)

(Reporting by Manvi Pant in Bengaluru)

(([email protected]; +918447554364;))

July 26 (Reuters) - Godfrey Phillips India Ltd GDFR.NS:

• GODFREY PHILLIPS INDIA JUNE-QUARTER CONSOL NET PROFIT 2.54 BILLION RUPEES VERSUS 1.42 BILLION RUPEES

• GODFREY PHILLIPS INDIA JUNE-QUARTER CONSOL TOTAL REVENUE FROM OPERATIONS 12.45 BILLION RUPEES VERSUS 9.82 BILLION RUPEES

Source text for Eikon: ID:nBSE1TYgVY

Further company coverage: GDFR.NS

(([email protected];;))

By Biplob Kumar Das and Aditya Kalra

BENGALURU/NEW DELHI, May 31 (Reuters) - India unveiled guidelines on Wednesday requiring streaming platforms such as Netflix and Amazon Prime Video to display prominent warnings about smoking and other forms of tobacco use while airing shows with such scenes.

While film and television certification bodies already moderate public content in India, its laws have few provisions to censor content on popular online platforms.

The Cigarettes and other Tobacco Products Amendment Rules, 2023 made it mandatory for such platforms to display "anti-tobacco health spots" of at least 30 seconds each at the start and middle of a programme, a notice from the health ministry showed.

The new rules also made it compulsory for the platforms to display an anti-tobacco health warning as a "static message" at the bottom of the screen while displaying tobacco products on screen. It also mandated audio-visual disclaimers about the ill-effects of tobacco use.

The stringent laws come after a survey by the World Health Organization found that nearly 267 million Indians of age 15 and above consume tobacco.

"India's new regulations will ensure that streaming services are not the next vehicle for Big Tobacco's aggressive targeting of Indian youth," said Yolonda Richardson, an executive from non-profit group Campaign for Tobacco-Free Kids.

The amendment further states that the federal government will take suo moto action against streaming sites if they fail to adhere to the new rules.

Netflix and Amazon Prime Video and trade group Internet & Mobile Association of India (IAMAI), which represents the interests of several streaming websites, did not immediately respond to Reuters' request for comment.

The tough rules come years after court cases and complaints filed to the police alleged that some content on streaming platforms was obscene or insulted religious sentiment.

(Reporting by Biplob Kumar Das in Bengaluru and Aditya Kalra in New Delhi; Editing by Sonia Cheema)

(([email protected]; 9101861583;))