ITC, Godfrey Phillips Shares Plunge 5% After Steep Cigarette Excise Duty Hike

• Cigarette manufacturers ITC and Godfrey Phillips India saw shares fall up to 5% on Friday, extending losses after a sharp hike in excise duties.
• ITC shares hit a 52-week low, slipping 4.8%, while Godfrey Phillips India declined 4.3% on Friday.
• The government notified a revised excise duty of Rs 2,050 to Rs 8,500 per 1,000 cigarette sticks, effective February 1.
• Analysts warn of a "meaningful negative surprise," with overall tax incidence potentially rising beyond 20-30%, impacting volumes and earnings.
• Concerns include potential double-digit price hikes, leading to volume contraction, down-trading, and a resurgence of illicit cigarette trade.

Why It Matters: Steep excise duty hike on cigarettes causes significant stock drops for ITC and Godfrey Phillips, raising market concerns.