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ITC Slumps 4% over Tough Provisions of Anti-Smoking Bill

Tobacco companies such as ITC and Godfrey Philips India fell sharply on Wednesday as the government moved to amend the anti-smoking law, which proposes radical changes such as banning sale of loose cigarettes and raising the minimum age of a person buying tobacco products to 21 years from existing 18.
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ITC Slumps 4% over Tough Provisions of Anti-Smoking Bill

Shares in tobacco companies such as ITC and Godfrey Philips India fell sharply on Wednesday as the government moved to amend the anti-smoking law, which proposes radical changes such as banning sale of loose cigarettes and raising the minimum age of a person buying tobacco products to 21 years from existing 18.

ITC, India's biggest cigarette maker fell as much as 4 per cent in early trade, and weighed on broader markets. ITC is the most influential stock in the 50-share Nifty.

As of 10.10 a.m., ITC shares traded 2 per cent lower at Rs 252.95. Godfrey Philips traded 1.9 per cent lower at Rs 561.95, while VST Industries was down 1.4 per cent at Rs 1,905.

Fine for smoking in public places will be raised from Rs 200 to Rs 1,000 if the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) (Amendment) Bill 2015, comes into force.

According to the proposed bill, "No person shall sell, offer for sale, or permit sale of, cigarettes or any other tobacco products loose or in single sticks...to any person who is under 21 years of age; employ, engage or use any person who is under 18 years of age in cultivation, processing, sale of tobacco or tobacco products."

The proposed bill does away with designated smoking places in hotels and restaurants. The bill, however, allows smoking at designated places in international airports.

The new bill also proposes ban on spitting of tobacco products in public, saying it is one of the biggest causes of spread of infectious diseases like TB, pneumonia, swine flu and avian flu.

(With agency inputs)



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