Godfrey Phillips India experienced a sharp reversal in today’s session, with shares plunging to an intraday low of **2,401**. This **4.84%** decline marks a significant shift in sentiment after a robust three-day winning streak that had previously pushed the stock higher. The sell-off occurred despite a generally resilient broader market, where the Sensex climbed over **600 points** to finish at **82,892.13**. Investors engaged in aggressive profit booking, causing the cigarette maker to underperform the FMCG sector by a substantial **4.59%**. The tobacco industry is currently navigating a major fiscal overhaul following the implementation of a new excise duty structure on February 1, 2026. This regime has replaced the old compensation cess with a length-based duty, pushing retail prices up by **22% to 28%** for standard segments. While peers like ITC and VST Industries have initiated strategic price hikes to offset these costs—raising some pack prices by **25 to 55**—the market remains concerned about volume elasticity. Premium long-stick variants have faced the steepest tax impact, with duties reaching approximately **5.40 per stick**. Technically, Godfrey Phillips maintains support above its short-term **5-day and 50-day** moving averages. However, the stock continues to trade below its **200-day** moving average, a key long-term indicator that historically separates bullish and bearish phases. The company's recent Q3 results showed a **6.40%** rise in net profit to **353.61 crore**, but analysts are closely watching for signs of demand shifts toward illicit products or cheaper alternatives as legal cigarette prices climb toward **21 to 22** per stick. Market liquidity remains high, with nearly **7.82 lakh** shares changing hands today, reflecting a total traded value of approximately **190.10 crore**. This high-volume activity suggests that while institutional interest is present, the immediate path for the stock is defined by volatility. Looking ahead, the sector faces a structural shift. While the Indian cigarette market is projected to reach **66.2 billion USD** by 2034, near-term valuations for individual players remain capped by regulatory overhang and the ongoing transition to the new 2026 tax landscape.