ITC Share Price Slides; Check Which Mutual Funds Hold the FMCG Major

ITC shares witnessed a sharp sell-off on January 1 after the Finance Ministry announced fresh excise duties on tobacco products. The stock reacted negatively to concerns over higher taxation and its potential impact on cigarette volumes and profitability.

ITC Share Price Reaction

On January 1, 2026, shares of ITC declined nearly 10% during the session, falling from the day’s high of ₹402.30 to an intraday low of ₹362.70 on the BSE. The fall came after investors digested the Finance Ministry’s notification stating that additional excise duty on tobacco products will come into effect from February 1. The sharp move highlighted market sensitivity to regulatory changes affecting the tobacco sector.

Today, on January 2, ITC share price was trading at ₹350.95, down by 3.55%. The stock opened at ₹360.00 against its previous close of ₹363.85 and remained capped at the same level as its day’s high. During the session, it slipped to an intraday low of ₹345.25 on NSE. 

Details of the Excise Duty Notification

Late on Wednesday, the Finance Ministry notified an excise duty ranging from ₹2,050 to ₹8,500 per 1,000 cigarette sticks, depending on the length of cigarettes. The revised duty structure is scheduled to be implemented from February 1. 

In addition to excise duty, pan masala, cigarettes, tobacco, and similar products will attract a GST rate of 40%, while biris will be taxed at 18% GST. A Health and National Security Cess will also be levied on pan masala, with tobacco products facing additional excise levies.

Shareholding Pattern and Mutual Fund Exposure

As per the shareholding pattern for the September 2025 quarter, ITC is entirely held by public shareholders, with no promoter or promoter group stake. Mutual funds remain significant investors in the company. Data from ACE MF shows that mutual funds collectively held around 195 crore shares of ITC, valued at ₹78,952.33 crore as of November 2025.

SBI Mutual Fund was the largest holder with ~41.15 crore shares worth ₹16,638 crore. ICICI Prudential Mutual Fund and Nippon India Mutual Fund followed with holdings of 33.71 crore and 18.02 crore shares, respectively. PPFAS Mutual Fund held 15.55 crore shares valued at ₹6,290 crore. HDFC Mutual Fund and Kotak Mutual Fund also featured among major holders, each owning more than 10 crore shares.

Smaller holdings were reported by Edelweiss Mutual Fund, Quant Mutual Fund, JioBlackRock Mutual Fund, Zerodha Mutual Fund, The Wealth Company Mutual Fund, Samco Mutual Fund, and Altiva SIF by Edelweiss Mutual Fund.

Also Read: Best Gold Mutual Funds in India for Jan 2026!

Conclusion

The announcement of higher excise duty and additional levies on tobacco products has intensified concerns around pricing power and demand for cigarette manufacturers like ITC. While institutional ownership remains strong, the near-term outlook for the stock may remain cautious as markets assess the impact of higher taxes on volumes, margins, and overall profitability.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a private recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.