Egypt Daily News – Cigarette companies operating in the local market continued to raise their product prices by 12%, whether for foreign or local cigarettes, just days after the Eastern Company (Eastern Tobacco) increased the prices of its popular “Cleopatra” products by 8% to 12%.
The Japanese company “JTI” raised the price of the Gold Coast brand by 12%, bringing it to 42 pounds, while Mansour International increased the prices of Target and Time Select cigarettes to 38.75 pounds, also by the same percentage.
The government had allowed cigarette companies to increase the maximum prices by 12% last April.
Ibrahim Imbabi, head of the Tobacco Division at the Federation of Industries, told “Al-Shorouk” that the new increases come within the framework of implementing Law 11 of 2023, which allowed for the opening of price brackets for cigarettes.
The Eastern Company attributed the price increase to the difficulty of covering the deficit resulting from the rise in cost elements, despite raising prices last April. It pointed out that the company receives 50% of the revenues from any price increase to cover part of the cost, while the other percentage goes to the state treasury.
The company added that the increase in the dollar exchange rate from 31 to 48 pounds significantly raised costs, in addition to the rise in prices of tobacco and non-tobacco raw materials, and the increase in shipping costs due to current logistical conditions. The raw materials component accounts for 75% of the total manufacturing cost, which has added a significant burden on the company.
In May of last year, Philip Morris International acquired a minority stake of 14.7% in Eastern Company, in a deal whose value was not disclosed. However, the company’s managing director, Hani Aman, stated that it was part of a stake previously acquired by the UAE’s Global Investment Holding Company.
Egypt announced last November that “Global Investment Holding” had purchased 699 million shares of “Eastern Company” at a price of 24.52 pounds per share, totaling 625 million dollars, as part of a state asset sale program within the economic reform plan that faced a crisis last year.
