Crackdown: Vape maker Chill Brands lost nearly a third of its value after Rishi Sunak announced a ban on disposables
Shares in London-listed vaping firms took a kicking yesterday after Rishi Sunak announced a ban on disposables.
Vape maker Chill Brands lost nearly a third of its value, with shares dropping 30 per cent, wiping £4.6million off its value and leaving it with a market capitalisation of just over £12million.
Shares in Supreme also fell around 2 per cent in early morning trade before rallying in the afternoon when the company asserted it was ‘ahead of the curve’ for regulatory changes.
The Prime Minister laid out plans that he hopes will stamp out the growing number of youngsters taking up the habit.
Recent data suggests that the number of children vaping has tripled in the past three years with 9 per cent of 11-to-15-year-olds using the devices.
And aside from banning disposable vapes, the Government has also said it will introduce restrictions on flavours, colourful packaging and how vapes are displayed in shops.
This is a major headache for producers and distributors, who will need to adapt to the changes.
‘Effectively, investors are saying there is a major risk to earnings, whether it is from Sunak’s latest announcement or the general direction of travel by the Government to stop young people getting into the vaping habit,’ said Russ Mould, analyst at AJ Bell.
Chill Brands maintained that its products, equipped with recharging ports, should not be classified as disposable. Supreme bosses welcomed the announcement having taken a ‘number of proactive measures’ in recent months.