ECOM050- INVESTMENT MANAGEMENT
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Master Enrolled: Investment and Finance
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, Investment Management 2
Introduction
British American Tobacco PLC (BAT) is British multinational cooperation which deals
with cigarette and tobacco manufacturing. It is headquartered in London, United Kingdom. BAT
has a primary listing in the London stock exchange, and it's among the top traded companies.
Due to increasing health risk brought by smoking and the use of tobacco products, BAT is at the
front line of developing products which offer a less risky alternative to other cigarettes. BAT is
considered one of the leading company in the developing countries that provides an alternative to
the highly hazardous products produced by other companies. Due to this, BAT has invested a lot
of resources in Next Generation Products (NGPs) which include e-cigarettes which are tobacco
heating products and also nicotine products that have been licensed as health products. More
than £500 million has been invested in the research and development programs, and BAT
believes that through these researches, the community will benefit significantly by diverting
from the use cigarettes that are harmful to the health and also avoid smoking.
Investment Case
British American Tobacco is a worldwide leader in the production of cigarette and
smoking-related commodities. The mix of growth potential and the defensive qualities that BAT
offers can be said to be its most significant and attractive feature (Minot, N., 2018 p. 37).
Because tobacco is an addictive drug from many people, the tobacco producing company can
raise its prices whenever they need to, and this leads to the acquirement of huge profits that can
be used by BAT for its overall growth since it produces tobacco in all seasons. Nevertheless,
BAT is a monopolistic company in Britain, and this also attributes to its capability of raising
prices and generating a lot of money for its production processes. In the recent plans.