Godfrey Phillips shares extend gains to second day, soars 44%

Over just two days, the tobacco giant’s stock has skyrocketed by an impressive 44 percent

Shares of Godfrey Phillips continued their winning streak for the second straight session, climbing as much as 20 percent to Rs 7,170 apiece on February 17, fueled by strong third-quarter earnings. Over just two days, the tobacco giant’s stock has skyrocketed by an impressive 44 percent.

The company reported a robust 48.7 percent year-on-year (YoY) surge in net profit for the December quarter, reaching Rs 316 crore. Meanwhile, revenue from operations jumped 27.3 percent YoY to Rs 1,591 crore, driven by substantial growth in its core business of cigarettes, tobacco, and related products.

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On the operational front, Godfrey Phillips’ EBITDA soared 57.6 percent to Rs 359 crore in Q3FY25, with EBITDA margins expanding sharply by 440 basis points YoY to 22.6 percent.

Notably, the company holds an exclusive sourcing and supply agreement with Philip Morris International for manufacturing and distributing Marlboro cigarettes in India, with tobacco making up the bulk of its gross sales.

The domestic cigarette industry has faced headwinds in recent years due to rising taxes, stringent regulations, and a surge in illicit trade—particularly in the premium segment—posing significant challenges to legal cigarette manufacturers.

However, recent government crackdowns on illegal cigarette sales, coupled with moderate price hikes within the cigarette portfolio, are expected to drive stronger volume growth, according to Mirae Asset Sharekhan.

In terms of ownership, the company’s shareholding pattern remained largely stable. Promoter holdings were unchanged, while foreign institutional investors (FIIs) marginally reduced their stake to 10.6 percent from 10.8 percent. On the flip side, mutual funds slightly increased their holdings to 1.8 percent in the December quarter, up from 1.78 percent in the previous quarter.

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