Shares of ITC extended their decline in early trade, falling over 4 percent for the second straight session as selling pressure persisted across tobacco stocks amid the upcoming tax changes on tobacco and pan masala products.
ITC Stock Remains Under Selling Pressure
ITC was trading at ₹349.20, down ₹14.65 or 4.03 percent from its previous close of ₹363.85. The stock opened lower at ₹360.00 and slipped further during early trade, touching an intraday low of ₹346.05. The session high was capped at ₹360.00, indicating limited buying interest after the weak opening.The volume-weighted average price stood at ₹350.83, showing that the stock largely traded below its previous closing level during the session.
Order Book Signals Dominant Sell Interest
Market depth data reflected a clear imbalance in favour of sellers. Total sell quantity stood at 32,12,563 shares, compared with a buy quantity of 20,14,735 shares. Around 61.46 percent of visible orders were on the sell side, highlighting continued pressure on the counter.Buying interest was seen near the ₹348.90 to ₹349.10 range, while heavier quantities on the ask side were visible between ₹349.20 and ₹349.40, indicating resistance at higher levels.
New Levies to Take Effect From February 1
The newly announced charges are set to come into force from February 1 and will apply in addition to the existing Goods and Services Tax framework. These levies will replace the compensation cess currently applicable on tobacco products and other sin goods.From the effective date, pan masala, cigarettes, tobacco, and similar products will attract a GST rate of 40 percent, while beedi will be taxed at 18 percent. Alongside this, a Health and National Security Cess will be imposed on pan masala, and tobacco and related products will face an additional excise duty.
Sector Reacts to Higher Tax Burden
The market reaction reflects concerns that the higher tax burden could weigh on consumption trends and profitability for tobacco companies. With the revised tax structure nearing implementation, investor sentiment remained cautious, leading to broad-based selling in cigarette and tobacco stocks during early trade and keeping ITC under sustained pressure.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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