Godfrey Phillips India tanks nearly 7% in early trade

The shares of cigarette manufacturer Godfrey Phillips India declined nearly 7% in an early morning trade on the Bombay Stock Exchange (BSE) on Thursday.

The stock of the company fell 6.96% to Rs 878.75 per share on the stock exchange.

After the news reports of the government working on a proposal to completely ban foreign direct investment (FDI) in the tobacco sector came in early this week, the shares of cigarette manufacturers have been under pressure.

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The government has recently imposed mandatory 85% pictorial warning on the packaging of all tobacco products including cigarettes from April 1.

At present, FDI is permitted in technology collaboration in any form, including licensing for franchise, trademark, brand name and management contract in the tobacco sector. However, it is prohibited in the manufacturing of cigars, cigarettes of tobacco and tobacco substitutes.It would eventually mean that FDI would be totally banned in tobacco segment in any form.

At 10:52 hours, the shares of Godfrey Phillips India recovered slightly but were still trading down 5.24% or Rs 49.50 to Rs 895.00 per scrip on the stock exchange.

(With PTI Inputs)