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What is the story about?
ITC has increased the prices of two cigarette brands, Classic Connect and Gold Flake Superstar, sources said.
The price of a 20-cigarette pack of Classic Connect has been raised to ₹428 from ₹390, while the price of a 10-cigarette pack of Gold Flake Superstar has been increased to ₹89 from ₹79.
The latest price revisions represent increases of ₹38 for Classic Connect and ₹10 for Gold Flake Superstar.
The latest price increases come after ITC had indicated that it was taking a staggered approach to passing on recent cigarette tax increases.
On May 5, ITC Chairman and Managing Director, Sanjiv Puri had told CNBC-TV18 that the company has passed on 50–60% of recent cigarette tax hikes and will roll out the remaining increases over time, as it seeks to balance pricing with volume stability.
“We’ve passed on about 50–60% so far. It is ongoing, and more will happen over time. Ultimately, the entire increase has to be passed on, but we are cushioning the impact to retain volumes as much as possible,” he said.
Puri had also said the tax increases were “quite severe” and that passing on the entire increase at once could encourage a shift towards illicit products.
“Every time taxes increase, it gives a fillip to illicit trade… passing them on in one go could accelerate the shift to illicit products. So we are staggering the increases,” Puri said.
In Q1 FY27, ITC’s cigarettes business undertook staggered and calibrated pricing actions following the tax increase, aimed at managing the risk of volume migration to illicit trade while protecting its consumer base.
The company also implemented measures to rework its product portfolio across segments and price points, while focusing on execution to improve market responsiveness.
A new excise duty framework came into effect from February 1, 2026, making cigarettes and other tobacco products costlier, according to News18.
The report said cigarettes attract additional excise duties ranging from ₹2,050 to ₹8,500 per 1,000 sticks, depending on their length and whether they are filtered.
These duties are levied over and above GST of up to 40%, increasing the overall tax burden and retail prices across categories. Longer and filtered cigarettes saw sharper price increases as manufacturers passed on the higher tax costs to consumers, News18 reported.
ITC Ltd shares ended 2.62% higher at ₹264.75 on September 16, gaining ₹6.75 during the session.
Also Read: ITC eyes scale across FMCG, hotels and digital channels amid strong India outlook | Q&A
The price of a 20-cigarette pack of Classic Connect has been raised to ₹428 from ₹390, while the price of a 10-cigarette pack of Gold Flake Superstar has been increased to ₹89 from ₹79.
The latest price revisions represent increases of ₹38 for Classic Connect and ₹10 for Gold Flake Superstar.
The latest price increases come after ITC had indicated that it was taking a staggered approach to passing on recent cigarette tax increases.
On May 5, ITC Chairman and Managing Director, Sanjiv Puri had told CNBC-TV18 that the company has passed on 50–60% of recent cigarette tax hikes and will roll out the remaining increases over time, as it seeks to balance pricing with volume stability.
“We’ve passed on about 50–60% so far. It is ongoing, and more will happen over time. Ultimately, the entire increase has to be passed on, but we are cushioning the impact to retain volumes as much as possible,” he said.
Puri had also said the tax increases were “quite severe” and that passing on the entire increase at once could encourage a shift towards illicit products.
“Every time taxes increase, it gives a fillip to illicit trade… passing them on in one go could accelerate the shift to illicit products. So we are staggering the increases,” Puri said.
In Q1 FY27, ITC’s cigarettes business undertook staggered and calibrated pricing actions following the tax increase, aimed at managing the risk of volume migration to illicit trade while protecting its consumer base.
The company also implemented measures to rework its product portfolio across segments and price points, while focusing on execution to improve market responsiveness.
A new excise duty framework came into effect from February 1, 2026, making cigarettes and other tobacco products costlier, according to News18.
The report said cigarettes attract additional excise duties ranging from ₹2,050 to ₹8,500 per 1,000 sticks, depending on their length and whether they are filtered.
These duties are levied over and above GST of up to 40%, increasing the overall tax burden and retail prices across categories. Longer and filtered cigarettes saw sharper price increases as manufacturers passed on the higher tax costs to consumers, News18 reported.
ITC Ltd shares ended 2.62% higher at ₹264.75 on September 16, gaining ₹6.75 during the session.
Also Read: ITC eyes scale across FMCG, hotels and digital channels amid strong India outlook | Q&A
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