Japan Tobacco (TSE: 2914) shares fell 19.3% in Tokyo after Russian President Vladimir Putin signed a decree handing temporary control of assets held in Russia by the company’s European subsidiary to a Russian company, Yomiuri Shimbun reported on November 6. The tobacco maker confirmed that four of its manufacturing companies in Russia were covered by the order.
Russia is one of JT’s main markets and accounts for roughly a quarter of its operating profit. If the situation drags on, the company faces falling sales and other damage to its business. JT keeps ownership of the Russian units, but the decree in effect strips it of management control.
In a statement, JT said it was gathering details on the measure and weighing possible responses, as well as assessing the impact on the group. Investors rushed to sell the stock, which closed sharply below its previous day’s level.
Officials from the Ministry of Economy, Trade and Industry and the Foreign Ministry who were in Russia lodged a protest with the Russian government and called for the decree to be reversed. The Japanese government owns 37.55% of JT.
Finance Minister Katayama told a press conference after a cabinet meeting that Tokyo had protested through diplomatic channels and urgently sought the measure’s withdrawal. He said the government would monitor developments and respond appropriately.
JT entered Russia in 1999 and leads the market with a share of about 40%, selling brands including Winston and Camel. Its Russian sales volume reached 59.9bn cigarettes between January and September this year, more than the 46.4bn it sold in Japan. The company employs around 4,000 people in the country.
For the year ended December 2025, Russia generated about 10% of JT’s revenue of JPY3.4676 trillion ($21.9bn) and about 25% of its adjusted operating profit of JPY902.2bn under international accounting standards. In October, JT raised its forecast for 2026, citing higher cigarette prices in Russia, and expected the Russian business to contribute a similar share of earnings as in 2025.
Moscow introduced temporary management in 2023 as a countermeasure against US and European sanctions. Danish brewer Carlsberg and French food group Danone were earlier targets, and both eventually saw their Russian operations sold to Russian buyers.