Rumours & Uncertainty for Big Tobacco

Rumours are swirling that the Queen will announce in May an initiative to curb tobacco use that will include plain packaging

Thomas Mullarkey, CFA 7 March, 2013 | 9:00AM
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Shares of Imperial Tobacco (IMT) were down nearly 2.5% on Wednesday, March 6, following a story in the Guardian suggesting that the Queen will announce in May an initiative to curb tobacco use that will include plain packaging, and a ban on smoking in cars carrying anyone under the age of 16.

Any sudden decrease in cigarette use in the UK will disproportionately impact Imperial Tobacco

We note that any sudden decrease in cigarette use in the UK will disproportionately impact Imperial Tobacco, which holds 45% market share of the country's cigarette market, and 47% share in the fine cut market, and derives roughly 21% of its operating profit from the country.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
British American Tobacco PLC2,583.50 GBP0.00Rating
Imperial Brands PLC1,559.00 GBP0.00Rating
Philip Morris International Inc89.38 USD0.00Rating

About Author

Thomas Mullarkey, CFA  is an equity analyst at Morningstar.