The cigarette king of KK Modi Group, Godfrey Phillips, just lit up Q1 FY26 with ₹1,486 cr revenue (+27% YoY) and ₹356 cr profit (+32.5% YoY). Margins are stable at 23% OPM, and ROE roars at 24%. The only thing smokier than its cigarettes is its P/E (38×) and the fact that working capital days jumped to 100. Share price? On fire – up 115% YoY.
2. Introduction
Godfrey Phillips India Ltd (GPIL), the Marlboro-maker for India, has had an explosive rally with stock touching ₹9,000 levels. Even as India’s anti-tobacco drive intensifies, GPIL finds ways to puff profits via premium brands, other income boosts, and cost control. Q1 FY26 continues this streak with strong top-line and bottom-line growth, proving once again that sin stocks rarely sin against investors.
3. Business Model (WTF Do They Even Do?)
Cigarettes: Core revenue driver (~85%), includes Four Square, Red & White, Cavanders, and Marlboro (via Philip Morris tie-up).
FMCG & Others: Tea, leaf processing, and distribution.
Retail: Exited 24Seven chain to focus back on tobacco profits.
Geography: Primarily India, with exports in select markets.
Roast: They’ve shed retail baggage, focusing on cigarettes where margins burn brightest.
4. Financials Overview
Revenue (Q1 FY26): ₹1,486 cr (↑26.98% YoY)
EBITDA: ₹338 cr (OPM 23%)
PAT: ₹356 cr (↑32.5% YoY)
EPS (Q1): ₹68.5
ROE (FY25): 24.3%
ROCE (FY25): 29.6%
Commentary: The company keeps printing cash while being almost debt-free. Other income (₹141 cr) is the cherry on top.
