New Delhi, Feb. 26 -- The tobacco industry is feeling the heat. Rising tobacco leaf prices have squeezed cigarette makers' margins over the past year, and experts anticipate little relief in the fourth quarter of FY25.

"Tobacco prices have gone up 20% in the last seven months and competition has intensified in the industry lately. So, cigarette prices won't rise drastically either and margins will remain subdued in Q4 (for ITC)," said Devarsh Vakil, head of prime research at HDFC Securities.







ITC, India's largest cigarette maker, reported a 211 basis-point year-on-year decline in its cigarette Ebitda margin in the December quarter (Q3FY25), largely due to a 25-30% increase in tobacco leaf prices.

Read this | Company Outsider: ITC'...