VST Industries Ltd.					19 Jul 2011	Access Report

	Beating our estimates, VST Industries in 1QFY12 recorded EBITDA growth of 144.8% to `494mn (our estimate: `387mn) and PAT growth of 86.9% to `337mn (our estimate: `337mn). The growth was led by ~8% volume growth, higher than our expectation of 5%. Despite strong performance by the company’s domestic cigarette business, net sales grew by 15.1%, lower than our estimate, as tobacco exports declined by ~36%, which should pick up in subsequent quarters. Gross margin expanded by 749bps to 58.2% as.....

	ITC Ltd.					15 Jul 2011	Access Report

	The recently-announced budget by the government of Kerala has not recommended any increase in VAT on cigarettes, which is currently at 12.5%. In contrast, the budget has called for an increase in VAT on pan masala and chewing tobacco products from 12.5% to 20%. Though there were doubts earlier that VAT hikes on tobacco products would cover cigarettes too, the Kerala government’s statement about mobilising just `50 million through this hike, makes it obvious that VAT on cigarettes has not been.....