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Stocks of cigarette manufacturers gained as GST council has capped the cess on demerit goods.
Shares of Indian cigarette makers gained 3-7 per cent.
The Goods and Services Tax (GST) council had on Thursday set a cap on cess to be imposed on luxury, sin and demerit goods.
In the case of cigarettes and chewing tobacco, cess levied could be either 290 per cent or Rs 4,170 ($63.58) per thousand sticks or a combination of both, according to reports.
“The cap on cess is the ceiling and the actual cess imposed may be slightly lower,” Nomura analysts write in a note.
ITC Ltd jumped as much as 7.34 per cent to highest since February 7 and the stock was the top percentage gainer on the NSE index.
Godfrey Phillips India Ltd rose 3.07 per cent, VST Industries Ltd climbed 3.93 per cent, and Golden Tobacco Ltd gained 3.1 per cent.
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