Godfrey Phillips shares drop over 6% as excise duty charges weigh down Q1 earnings; what investors should know

Godfrey Phillips India shares declined more than 6% after the opening bell on Tuesday, July 28, as market investors focused on the company’s heavy excise duty expense in the April to June quarter of the financial year 2026-27, weighing down overall profits despite revenue growth.

Shares of Godfrey Phillips dropped 6.5% to their morning market low of ₹2,066.60 during Tuesday’s market session, in comparison to ₹2,210.50 apiece at the previous stock market close, according to NSE data.

After touching the intraday low, the cigarette maker’s shares were trading 6.3% lower at ₹2,070 apiece, right above the intraday low mark during the morning market hours, as per the exchange data.

The Indian central government imposed the Central Excise (Amendment) Bill, 2025, effective from February 1, 2026, revising the framework of excise duties levied on manufactured tobacco products, unmanufactured tobacco and all other tobacco-related products in the country.

For cigarette makers like Godfrey Phillips, the excise duty imposed on manufactured tobacco products was increased from 25% to 40%. In the case of smoking mixtures for pipes and cigarettes, the duty was increased from 60% to 325%.

Why did Godfrey Phillips' profits fall in Q1 results?

Godfrey Phillips' board of directors announced their April to June quarter FY2027 earnings after market hours on Monday, July 27, which disclosed that the cigarettes maker posted a 44.3% year-on-year (YoY) decline in consolidated net profits (attributable to owners) to ₹198.39 crore, from ₹356.31 crore in the same period a year ago.

Although the company’s revenue from core operations advanced 110.64% in the June quarter to ₹3,819.56 crore, in comparison to ₹1,813.26 crore in the same quarter of the previous financial year, the profits declined due to the rise in expenses.

The total expenses of the company gained at a YoY basis due to the massive surge in excise duty charges levied in the period under review after the central government’s updated tax norms earlier this year.

NSE filings showed that Godfrey Phillips’ excise duty charges increased nearly 700% YoY to ₹2,614.05 crore in the first quarter of Fy27, compared with ₹327.06 crore in the same period a year ago.

On a sequential basis, the cigarette maker’s excise duty charges increased 54% to its June quarter levels, from ₹1,698.27 crore in the fourth quarter of FY26.

Due to this 700% rise YoY, the company’s consolidated net profits declined in the period under review.

Godfrey Phillips revenue breakdown

The majority chunk of Godfrey Phillips’ revenue comes from the company’s cigarettes, tobacco, and related products business, which recorded a 112% YoY rise to ₹3,779.81 crore in the April to June quarter, from ₹1,781.36 crore a year earlier.

The remaining revenue comes from the company’s other businesses, which recorded a 24.6% rise to ₹39.75 crore, compared year-on-year with ₹31.90 crore in the same quarter of the previous financial year.

Share price performance

Godfrey Phillips shares have delivered more than 190% returns to their investors in the last five years, and nearly 200% gains on their investment in the last three-year period, according to NSE data.

However, the company’s stock has lost 28.5% in the past one year, and was down 9.5% on a year-to-date (YTD) basis, as per the exchange data.

Shares of Godfrey Phillips have dropped 8% in the last one month and have declined 3% in the last five market sessions.

The cigarette maker’s market capitalisation (m-cap) was at ₹32,303.82 crore as of the trading session on Tuesday, July 28, 2026.