Cigarette major ITC's scrip hit a high of Rs 1,400 in intra-day trades. It closed the day at Rs 1378.85, up 11.16 per cent over Tuesday's close, with 3.9 million shares being traded on the Bombay Stock Exchange.
Godfrey Phillips hit a lifetime high of Rs 599 in intra-day trades, after opening at Rs 540, but closed at Rs 588.90, up 6.83 per cent. GTC was frozen at the 20 per cent upper-circuit limit of Rs 29 for most of the day, after opening at Rs 23.90.
Shares of VST Industries closed up 6 per cent at Rs 261.45, after opening at Rs 250 and going to an intra-day high of Rs 264.50.
The impact of the ruling, according to analysts, is that it would favourably impact the earnings of most cigarette manufacturers. ITC, for instance, pays more than 6 per cent of its gross turnover from cigarettes as luxury tax.
Company sources said ITC could benefit by several hundred crore per financial year. ITC had made provisions in its books for about Rs 1,200 crore (Rs 12 billion) on this account and the ruling should free that sum, sources added.
No confirmation was available from the firm, nor could the figures on the luxury tax paid in the last fiscal be confirmed.
ITC refused to comment on the scope of the judgement or on possible refunds or tax credits till it received the full copy of the court ruling.
Analysts in Kolkata said it was the largest gain by a single sector in one day on exchanges in recent times.
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