Shares of major cigarette manufacturing companies surged up to 8 per cent on the domestic bourses today after Lok Sabha approved the bill to ban electronic cigarettes.
Godfrey Phillips India, the leading company of K K Modi Group, was top gainer among the cigarette stocks, surging as much as 7.97 per cent to touch 52-week high of Rs 1,354 apiece on the Bombay Stock Exchange. Earlier today, the stock opened marginally higher at Rs 1,263 against the close of Rs 1,254.05. The stock finally settled at Rs 1,335.35, up 6.48 per cent.
Among others, VST Industries share price ended 1.08 per cent higher at Rs 4,422 apiece. During the day's trade, the stock touched an intraday high of Rs 4,468.30.
In contrast, ITC share price ended 0.86 per cent lower at Rs 246.95, while Golden Tobacco stock closed down by 3.13 per cent at Rs 31 apiece.
The Prohibition of Electronic Cigarettes Bill, 2019, seeks to replace an ordinance issued on September 18. Earlier in September, the Union Cabinet had cleared banning of e-cigarettes to help protect the youth. The bill makes manufacturing, production, import, export, distribution, transport, sale, storage or advertisements of such alternative smoking devices a cognisable offence, attracting a jail term and a fine.
Any individual found violating the norms for first time may end up paying a fine of Rs 1 lakh or face a jail term of up to one year. For subsequent offences, a jail term of up to three years or a fine of Rs 5 lakh, or both, will be imposed, as per the ordinance.
The storage of e-cigarettes shall also be punishable with imprisonment of up to six months or a fine of up to Rs 50,000, or both, it added.
Electronic-cigarettes are battery-operated devices that produce aerosol by heating a solution containing nicotine, which is the addictive substance in combustible cigarettes. These include all forms of electronic nicotine delivery systems, heat not burn products, e-Hookah and the like devices. These novel products come with attractive appearances and multiple flavours and their use has increased exponentially and has acquired epidemic proportions in developed countries, especially among youth and children.
Edited by Chitranjan Kumar