>ITC(HSBC)

With the introduction of VAT, an increase in excise duty for
non-filtered cigarettes and a recent smoking ban in public
places (2 October), the tobacco sector is getting hit hard and
fast. These measures are part of an overall global plan to
reduce tobacco consumption, spearheaded by the WHO.
While it is true that, in India, the vigour of implementation
may change depending on political or other factors, we
believe the tobacco sector is in for a tough time in the long
term. The halcyon days of FY05-07 averaging 7.5% volume
growth pa may be over.

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