Peering through the smoke
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Allan Gray Unit Trust Management

  Allan Gray Unit Trust Management   Q2 of 2024 | 3 years ago

Of the companies we research, the tobacco industry has some of the best structural fundamentals. Tobacco consumption is relatively price-inelastic, which means that price increases can make up for falls in sales volumes. Taxes make up a large portion of sale prices. This creates price leverage, causing consumer prices to rise by less than net revenues received by the business when excise rates do not change. In addition, specific taxes in some countries and efficient distribution make it difficult for new entrants to compete on price, especially since marketing is not allowed in most countries.


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Botique CI and Botique Investemnt Partners were acquired by Apex Group in year 2023.

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