Shares in Imperial Tobacco gain 1.3 percent, topping the FTSE 100 risers board with the index down 0.6 percent, as Citigroup upgrades its rating for the cigarette manufacturer to “buy” from “hold” on hopes that a price war in Spain is now over.
“BAT has followed the other 3 main players, and raised the price of Pall Mall to match Ducados Rubio and L&M, and also lifted Lucky Strike’s price by 0.10 euros,” Citigroup says in a note.
The broker thinks this confirms that the price war in Spain is over, and follows the ending of other price skirmishes in Russia, Poland, the Netherlands and elsewhere.
“A major risk for Imperial has disappeared,” Citigroup says, upping its rating for the stock and raising its target price to 2,450 pence from 2,260 pence.
BAT shares slip 0.1 percent lower.
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