ITC Limited , a diversified conglomerate, has received an Environmental, Social, and Governance (ESG) rating of 66 from NSE Sustainability Ratings Analytics Limited for the financial year 2024-25. This rating represents a marginal decline of one point compared to the previous financial year 2023-24.

ESG Rating Assessment Details

Voluntary Assessment and Regulatory Disclosure

ITC Limited voluntarily underwent this ESG assessment, demonstrating its commitment to transparency and sustainable practices. The company promptly informed the National Stock Exchange of India Limited and BSE Limited about this rating on December 10, 2025, in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Rating Methodology and Analysis

While the detailed methodology for arriving at the ESG score has not been shared with ITC Limited, the company received a summary report indicating the marginal decline in its rating from the previous financial year. The assessment was based on data pertaining to the financial year 2024-25, providing a comprehensive evaluation of the company's environmental, social, and governance practices.

Market Implications

The ESG rating of 66 provides valuable insights for investors who are increasingly considering sustainability factors in their investment decisions. Although ITC's rating has seen a slight decrease from the previous year, the overall score suggests that the company maintains a relatively strong position in terms of its ESG practices within the industry framework.

Strategic Outlook

As ESG considerations continue to gain prominence in the corporate landscape, ITC Limited's proactive approach to obtaining and disclosing its ESG rating demonstrates its awareness of evolving investor preferences and regulatory expectations. The company's commitment to voluntary assessment and transparent disclosure aligns with growing market demands for sustainable business practices.

The Indian tobacco industry is set to experience a significant shift in its tax landscape following a recent legislative move by the Lok Sabha. The lower house of the Indian Parliament has given its approval to a bill that introduces substantial increases in excise duties on various tobacco products, a decision that could have far-reaching implications for major players in the sector, including ITC Limited .

Key Points of the New Legislation

The newly approved bill outlines the following changes in excise duties:

Potential Impact on the Tobacco Industry

This regulatory change is expected to have a significant impact on tobacco companies operating in India. The increased taxation may affect various aspects of their business, including:

1. Product Pricing: Companies might need to reassess their pricing strategies to absorb or pass on the additional tax burden.
2. Profit Margins: The higher excise duties could potentially squeeze profit margins if companies are unable to fully transfer the increased costs to consumers.
3. Consumer Demand: The potential increase in product prices might influence consumer behavior, possibly leading to reduced demand for tobacco products.
4. Company Valuations: The stock market may react to these regulatory changes, potentially affecting the valuations of tobacco companies listed on Indian exchanges.

Implications for ITC Limited

As one of India's leading tobacco companies, ITC Limited is likely to feel the effects of this new legislation. The company, known for its diverse portfolio that includes cigarettes, may need to adapt its strategies to navigate the changing regulatory environment.

While the exact impact on ITC's financials remains to be seen, investors and analysts will be closely monitoring how the company responds to these changes. ITC's ability to maintain its market position and financial performance in the face of increased taxation will be a key area of focus in the coming months.

Broader Context

This move by the Indian government aligns with global trends of increasing taxation on tobacco products as a measure to discourage consumption and promote public health. However, it also presents challenges for the tobacco industry, which contributes significantly to tax revenues and employment in many countries, including India.

As the industry adapts to these new regulations, stakeholders will be watching closely to see how companies balance their business interests with evolving regulatory requirements and public health concerns.