The Hindu Business Line : Excise duty hike may get passed on to consumers: Deveshwar

ITC has hiked the prices of its cigarette brand Wills Navy Cut from Rs 25 to Rs 27 a pack. The Chairman, Mr Y.C. Deveshwar, says that the new cigarette prices will come into effect as soon as manufacturing units are able to implement the change as it requires prices to be printed on the packs.

Excerpts from CNBC-TV18's exclusive interview with Mr Y.C. Deveshwar.

Why do you need to raise prices?

The previous year, we did not pass on the excise duty to the customer entirely. This year, I think we will have to pass it on. I am not yet sure as to what has been decided by the particular business.

How soon can we see an increase in cigarette prices?

It may not be across the board or we will phase it out over the year. The increase in cigarette prices will happen as soon as the manufacturing units are able to implement the change as it requires prices to be printed on the packs. I think it should be on now, and we should be able to see it in the market soon enough.

What impact would it have on your bottomline?

We normally do not offer comments on the future outlook, particularly for this year.

What is your outlook for the retail industry in India? There are reports that Wal Mart is coming to India.

I do not know about Wall Mart yet, unless they are willing to come with one brand and with 51 per cent of direct investment.

But modern retailing is now picking up in India. The larger focus of modern retailing is in metropolitan cities with urban consumers.

To bring the benefit of retailing at the doorstep of the farmer, ITC is giving the farmer choices in buying and in selling. I wish people from elsewhere in the world would come and set up shop in rural India to give the benefit of their retailing expertise for the benefit of farmers.

I am afraid, most people concentrate on the creamy layer in urban India. So, our retailing projects start from rural India.

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