Imperial Brands share price: French unit to appeal plain packaging

on May 10, 2016

Imperial Brands’ (LON:IMD) Seita unit, which makes the iconic Gauloises and Gitanes cigarettes, will appeal to France’s top court against regulations imposing plain packaging, the Guardian has reported. The move, however, will not suspend the regulation from taking full effect from January 1.

Imperial Brands’ share price meanwhile has been little changed in today’s trading, having shed 0.05 percent to stand at 3,792.00p as of 14:38 BST, underperforming the benchmark FTSE 100 index which has climbed into positive territory and is 0.31 percent better off at 6,133.64 points. Imperial Brands’ shares have gained a little over 15 percent over the past year, and are up just under six percent in the year-to-date.

The Guardian reported today that Seita, the French subsidiary of Imperial Brands, was set to appeal to the council of state, France’s top administrative court, against regulations imposing plain packaging.
“Our rights to use our brands, several of which were created more than 100 years ago in France, should be respected,” Seita’s director for global corporate affairs, Axel Gietz, said, as quoted by the Guardian. The comments come after last month France published a decree introducing plain cigarette packages. Seita argues that the decree suppresses four out of five distinctive elements of a brand under French intellectual property laws, depriving business owners of their rights under the French constitution.
In analyst news, Goldman Sachs reiterated its ‘buy’ rating on Imperial Tobacco yesterday, with a valuation of 3,950p. Berenberg Bank and Societe Generale both continue to see the FTSE 100 group as a ‘buy’, with price targets of 4,230p and 4,250p, respectively. Imperial Brands updated investors on its half-year performance last week, posting a 16.8-percent rise in tobacco net revenue, and a 19.5-percent increase in total adjusted operating profit.

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