ITC share Price today: News and updates
On January 1, 2026, ITC Ltd. experienced a sharp decline in its share price, sliding roughly 8–10% in a single trading session and touching near three-year lows amid heavy selling pressure from institutional and retail investors.
This sudden fall has caught the attention of both new and seasoned traders, and in this post we explain why it happened, what it means for traders, and how investors should think about ITC in both the short and long term.
# Main Reason Behind Today’s Fall
# Government Announces New Excise Duty on Cigarettes
# Why This Matters for ITC’s Business
1. Cigarette Division Still Core to Profits
2. Higher Taxes ? Higher Retail Prices
3. Margin Pressure
# Short-Term Impact on ITC Stock
Increased Volatility
Bearish Investor Sentiment
Market Cap Loss
# Long-Term Perspective
~ Strong Diversified Business
~ Consistent Dividend Record
~ Large Institutional Ownership
# Key Points Investors Should Keep in Mind
~ Understand Sector Risk
~ Look at Business Mix
~ Risk vs Reward
~ Follow Quarterly Results
# Special Message for Investors
~ Don’t make decisions based on one day’s move — observe quarterly performance and management commentary.
~ If you are a long-term investor, focus on business quality and cash flow rather than short-term price swings.
# Final Recommendation
Expect heightened volatility. Use risk management tools like stop-losses and avoid large positions until clarity on pricing and volumes emerges.
Maintain a balanced view. ITC’s overall fundamentals remain intact, but regulatory risks in the tobacco business should not be ignored.
The primary trigger for the fall in ITC’s share price today was the government’s announcement of a new excise duty on cigarettes and tobacco products, effective February 1, 2026.
Under this notification:
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New excise duties ranging approximately ?2,050 – ?8,500 per 1,000 cigarette sticks have been imposed.
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This is in addition to the existing ~40% GST, increasing the total tax burden substantially.
Since cigarettes remain a major profit engine for ITC despite business diversification, the market reacted negatively — fearing lower future volumes and shrinking margins.
Even though ITC has diversified into FMCG, hotels, paperboards, and agri-business, cigarettes still contribute a significant portion of ITC’s profitability.
With the new excise duty in place, cigarette prices may need to increase by ?2 – ?3 per stick or more to protect margins. Higher retail prices can reduce consumption, especially in a price-sensitive market.
ITC has two choices:
This uncertainty often leads to market nervousness, and hence the sharp fall in share price.
After a major regulatory shock like this, stocks can remain volatile until investors see clarity on pricing strategy and quarterly earnings reaction.
Many traders booked profits as risk perception increased. Institutional brokers even downgraded the stock rating from Buy to Hold on tax implications.
The fall wiped out a large chunk of ITC’s market capitalization as investors reassessed future earnings prospects.
Despite the current shock, there are some positive pillars supporting this stock:
ITC is more than just a cigarette maker — key segments like FMCG and paperboards provide steady revenue streams.
ITC has historically rewarded shareholders with reliable dividends, making it attractive for long-term income investors.
Major mutual funds and institutions continue to hold significant stakes, implying confidence in long-term fundamentals.
Whether you are a beginner or a seasoned trader, consider the following:
Regulatory changes, especially in tobacco, affect ITC more than most FMCG peers.
ITC’s diversified revenue portfolio cushions tobacco risk but does not fully eliminate it.
Short-term traders should be cautious due to volatility; long-term investors should use dips as potential accumulation zones if fundamentals remain intact.
Any signs of volume drop, pricing strategy or margin pressure will likely shape the stock’s price action in coming quarters.
# Stay calm and informed — knee-jerk reactions often lead to mistakes.
Short-Term Traders: Expect heightened volatility. Use risk management tools like stop-losses and avoid large positions until clarity on pricing and volumes emerges.
Long-Term Investors:
Maintain a balanced view. ITC’s overall fundamentals remain intact, but regulatory risks in the tobacco business should not be ignored.