The cigarettes-crunch during the long lockdown is likely to force people to cut down – but those who continue will end up paying more

• Cigarettes are now being sold in black in shady corners for prices that will make you consider giving up smoking after all.
• As cigarettes are not listed as an essential commodity, its production has been halted affecting the availability in the market.
• ITC which has a 77% market share in the tobacco industry, has halted production in its factories in India.

For smokers, the lockdown has brought in one too many challenges. From dealing with the constant statement – “This is your nth cigarette of the day!” risking their lives (face mask and glove style) to step out and buy a new pack, smokers seem to have a lot to deal with.

But it doesn’t end there – cigarettes are now being sold in black in shady corners for prices that will make you consider giving up smoking after all.

As cigarettes are not listed as an essential commodity, its production has been halted which in turn has affected its availability as most shops are running out of their stored stocks.

ITC which has a 77% market share in the tobacco industry, has halted production in its factories in India.

And this unavailability could soon result in a further reduction in the number of smokers. Even after lockdown, cigarettes won’t see a great demand and it’s not just because it takes 21 days to break a habit.

“We note that even post-lockdown, when the production and availability improve; social distancing norms could result in pressure on volumes as Indian cigarette smoking is still predominantly loose cigarettes (c.70% of market) rather than packs,” said a report by ICICI Securities.

Reports say that, globally, cigarette sales may see its biggest fall in 20 years.

India has also been witnessing lower numbers of new smokers and the lockdown could further slow down people from picking up the vice and this is set to be another hindrance for the cigarette industry.

Moreover, cigarette prices in India have been on the rise as a 13% average annual tax increase is levied upon the industry. “This has resulted in a significant increase in unaffordability of cigarettes over this period. We therefore believe that Indian cigarette industry is unlikely to go the US way of sustainable priceled revenue growth construct,” said ICICI Securities in its report.

See Also:

IRCTC share price has jumped 30% in April so far despite the lockdown that’s halted trains, ticketing, and even Rail Neer sales