Age – In the age group of 25-64, 24.5% of the population has at some time consumed some form of tobacco (of which cigarettes is roughly one-sixth). Changing demographics indicate an increasingly young consuming class. Six out of ten households have a post-liberalization child and nearly 60% of the population are in the age group 15-59. This trend has significant implications on lifestyle aspirations, consumption capability and consequently for the value propositions of FMCG offers.Gender – Approximately 12.8% of the male population and 1.1% of the female population in urban metros have consumed some form of cigarettes. Thus, the male population is the primary TA for the cigarette industry, while the female consumption is not even developed to the extent of introducing a brand/product oriented towards them as in international markets such as Virginia Slims.
Income - The CAGR of 3.2% over the last five years in per capita income is unevenly spread across income segments. Upper-middle income households consume the highest cigarettes. While consumption declines in higher income group in urban areas, increasing consumption trend is observed in rural higher-income households. Poor households in rural areas are the lowest cigarette consumers.
Region - The gap between urban and rural households in cigarette consumption is the highest in low and lower-middle income households. Urban low and lower-middle income households consume more cigarettes compared to the similar income groups in rural areas.
Education - Most developed
countries has observed lower cigarette consumption in higher educated
This is the opposite in
Growing disposable incomes and increased media exposure are ushering in a revolution in consumer behavior, presenting growth opportunities for the industry.
account for about 85% of tobacco consumption globally, with an even
share of almost 100% in large markets like
The main source of raw materials for cigarettes is raw tobacco which is mainly found in the state of Andhra Pradesh. There is no scarcity in supply of raw tobacco since the net income earned by the farmers from cultivating tobacco has been found to be much higher than the net income earned from other crops.
cigarette industry in
that contraband cigarette trade in
and Other Tobacco Products (Prohibition of Advertisement and Regulation
Trade and Commerce, Production, Supply and Distribution) Act, 2003,
being implemented in a phased manner with effect from
rates of taxes, coupled with the aspiration of tobacco consumers to
can multiply the share of cigarettes in
growing public concern regarding increasing consumption of tobacco, its
implications and the need to prevent access to minors and non-users.
view to achieving improvement of public health in general, the
India has banned the advertising of cigarettes in
industry has always been on the receiving end when it comes to
taxes and duties in the financial budget of the country. The industry
reeling under ever-increasing excise duties and innovative form of
luxury tax. Also, due to the high taxes in the country, the
the Indian cigarette manufacture is adversely affected in the global
growth is being further stifled by the imposition of ban on smoking at
places and ban on advertisements. In addition to this, increasing
about harmful effect of smoking and lawsuits in western countries has
entire scenario pretty gloomy for the industry. This leads to increased
government regulation and public litigation and a reduced ability to
the product. In such a scenario, cigarette companies in
with the increasing threat to the tobacco