Alcohol & tobacco.

Alcoholic beverages and tobacco products together add about ₹1.1 lakh crore of manufacturing value in FY26 (0.35% of national GVA, split roughly ₹0.5 LC tobacco and ₹0.6 LC alcohol), yet governments raise about ₹3.8 lakh crore a year in state excise/VAT on liquor and central GST/cess/excise on tobacco — roughly three-and-a-half rupees of tax for every rupee of factory value added. This is the slowest-growing part of consumer manufacturing (GVA compounded at ~8.5% a year FY05-FY26, versus 11.9% nominal GDP growth), because legal cigarette volumes have been flat for fifteen years and beedi output has fallen a third since FY10, while alcohol volumes grow only modestly but premiumisation (prestige whisky, craft/strong beer) lifts value added faster than volume. For manufacturers the decision variable is mix and pricing rather than volume, since state governments set retail prices and 28 different excise regimes govern the alcohol channel; ITC's cigarette business alone produces about half of tobacco GVA and carries more market value than the entire listed alcohol sector.

Estimated GVA

1.1 ₹ lakh crore (tobacco ₹0.5 + alcoholic beverages ₹0.6; 0.35% of national GVA) · FY26

Household spend

5.9 ₹ lakh crore (PFCE COICOP 02; survey under-reports by 1.5-2x) · FY26

Taxes raised

~3.8 ₹ lakh crore (state excise+VAT on liquor ~₹3.0 LC; central taxes on tobacco ~₹0.8 LC) · FY26

Listed PAT

0.22 ₹ lakh crore (ITC cigarettes ~₹0.17 LC; alcohol sector ₹0.04 LC) · FY26

Listed market cap

~6.4 ₹ lakh crore (alcohol ₹2.5 LC at 64x PE; tobacco-attributable ~₹3.9 LC) · FY26

Employment

~5 mn (of which ~4 mn home-based beedi rollers) · FY26

Exports / Imports

1.9 / 1.2 US$ bn (leaf tobacco & cigarettes out; Scotch and wine in) · FY26

Listed and major private companies

12 listed, 6 large private count · FY26