ITC falls 3 percent on fears about regulatory action at home after Australia called on the world to match its tough new anti-tobacco marketing laws that will ban logos on cigarette packs.
Australia's action renews worries that an increase in value added tax in Uttar Pradesh might be emulated by other states.
IDFC Institutional on Monday downgraded the cigarette maker to "underperformer" from "outperformer", cutting its target price by 10 percent to Rs 244, citing the threat from increasing global regulatory risks.
"We believe that as regulatory concerns escalate, global majors will be de-rated and have a rub-off effect on ITC," said IDFC analyst Nikhil Vora in the note.