Godfrey Phillips India Limited , a prominent player in the tobacco industry, held its 88th Annual General Meeting (AGM) on September 4, 2025, where shareholders approved several significant resolutions that will shape the company's future governance and capital structure.

Key Appointments and Re-appointments

Shareholders gave their nod to the re-appointment of Mr. Sumant Bharadwaj as an Independent Director for a second five-year term, effective from February 13, 2026, to February 12, 2031. Mr. Bharadwaj, an advocate and partner at the law firm "Legal Remedy," brings a wealth of legal expertise to the board. His memberships in various prestigious legal associations, including the Bar Council of Delhi, the Supreme Court Bar Association, and international organizations, underscore his broad legal acumen.

In another important move, the company appointed M/s Chandrasekaran Associates as its Secretarial Auditors for a five-year term spanning from FY 2025-26 to FY 2029-30. Chandrasekaran Associates, a well-established firm of Practicing Company Secretaries, boasts over three decades of experience and has been peer-reviewed by the Institute of Company Secretaries of India (ICSI).

Increase in Authorized Share Capital

A significant resolution passed at the AGM was the increase in the company's Authorized Share Capital to Rs. 50.00 crore. This new capital structure comprises 24.70 crore equity shares of Rs. 2.00 each and 60,000 preference shares of Rs. 100.00 each. This move allows Godfrey Phillips India greater flexibility in its capital management and potential future fundraising efforts.

Dividend Declaration and Bonus Share Issuance

The company's strong financial performance was reflected in its shareholder rewards. The Board recommended a total dividend of Rs. 95.00 per share for the financial year 2024-25, which includes an interim dividend of Rs. 35.00 per share already paid. This represents a substantial 70% increase from the previous year's dividend of Rs. 56.00 per share.

In a move to further reward shareholders and improve stock liquidity, the Board has proposed issuing bonus shares in the ratio of 2:1, subject to shareholder approval. This decision comes after regulatory clarifications that had previously delayed the implementation of this proposal.

Financial Performance Highlights

Dr. Bina Modi, Chairperson and Managing Director, reported robust financial results for FY 2024-25:

• The tobacco segment contributed 99% of sales, including Rs. 2,120.00 crore from international business operations.

Corporate Governance and ESG Initiatives

The company reaffirmed its commitment to strong corporate governance and environmental, social, and governance (ESG) practices. Notably, Godfrey Phillips India significantly improved its score on the Dow Jones Sustainability Index, jumping from 43 to 64, reflecting its dedication to sustainable business practices.

The AGM also highlighted the company's CSR initiatives, including:

• A comprehensive health screening program for over 1,000 daily traders, hawkers, and their families in various cities
• Ongoing efforts in water security and climate resilience for tobacco farming communities

As Godfrey Phillips India moves forward, these strategic decisions and initiatives demonstrate the company's focus on sustainable growth, shareholder value, and responsible corporate citizenship in an evolving business landscape.

In a development that could impact Godfrey Phillips India and other tobacco sector companies, the Indian government is considering maintaining current tax levels on tobacco products, even after the planned abolition of the compensation cess. This move suggests a potential shift in the tax structure while aiming to keep the overall tax burden on tobacco products unchanged.

Potential Tax Structure Changes

According to recent reports, the government might propose keeping taxes on tobacco, gutka, and cigarettes at their current levels, despite the impending removal of the compensation cess. This strategy could involve adjusting the National Calamity Contingent Duty (NCCD) to maintain the existing tax incidence on these products.

Implications for Godfrey Phillips India

Godfrey Phillips India, a major player in the Indian tobacco industry, could be significantly affected by this potential policy decision. The company, known for its cigarette brands and other tobacco products, has been subject to various taxes, including the compensation cess.

Government's Balancing Act

The government's consideration to maintain tax levels through NCCD adjustments reflects a delicate balancing act. On one hand, it aims to ensure consistent revenue from the tobacco sector, while on the other, it seeks to simplify the tax structure by abolishing the compensation cess.

Industry Outlook

For Godfrey Phillips India and its peers, the proposed tax approach could mean a continuation of the current tax burden, albeit through a different mechanism. This stability in overall taxation might provide some predictability for the company's financial planning and pricing strategies.

Awaiting Official Confirmation

It's important to note that these are still potential plans, and the final decision will depend on various factors, including public health considerations and revenue requirements. Stakeholders in the tobacco industry, including Godfrey Phillips India, will be closely monitoring further developments and official announcements regarding these tax policies.

As the situation evolves, investors and industry observers will be keen to see how Godfrey Phillips India and other tobacco companies respond to any changes in the tax structure, and how it might impact their operations and market positioning in the long term.