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ITC Shares Drop After India Increases Cigarette Tax (Update2) 

ITC Ltd., India's biggest tobacco company, fell the most in three weeks in Mumbai trading after the government increased cigarette taxes, prompting brokerages to downgrade the stock.

Shares of Kolkata-based ITC fell 4.5 percent to 193 rupees on the Bombay Stock Exchange today, their biggest one-day decline since Feb. 11. . . .

The tax increase is ``steeper than expected,'' Citigroup analysts Princy Singh and Pragati Khadse said in a note to clients dated Feb. 29.

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