British American Tobacco (CHIX:BATSL) Effective Interest Rate on Debt %: 5.45% (As of Dec. 2025)

Author: Vera Yuan Vera Yuan
Vera Yuan
Vera Yuan
Director of Data and Quant Analytics at GuruFocus
Focused on building reliable datasets, financial models, and research tools for value-minded investors. Committed to turning complex data into practical guidance for value-investing and long-term wealth.
Reviewed by: Charlie Tian Charlie Tian
Charlie Tian
Charlie Tian
Founder & CEO of GuruFocus
Dr. Charlie Tian is the founder and CEO of GuruFocus.com, a leading global investment research platform established in 2004. With a Ph.D. in physics, Dr. Tian transitioned from science to finance, applying a data-driven, disciplined approach to value investing.

CHIX:BATSL British American Tobacco PLC CHIX:BATSL
71 GF Score
Price £43.74
GF Value £27.87
Valuation Significantly Overvalued
! 3 Warning Signs
View Full Analysis

What is British American Tobacco Effective Interest Rate on Debt %?

British American Tobacco CHIX:BATSL -0.39% 71 Effective Interest Rate on Debt % is 5.45% as of Dec. 2025. GuruFocus rates CHIX:BATSL with a GF Score™ of 71/100 and a GF Value™ of £27.87 (Significantly Overvalued). The stock has 3 warning signs investors should review.

Effective Interest Rate on Debt % is the usage rate that a borrower actually pays on a debt. It is calculated as the positive value of Interest Expense divided by its average total debt. Total debt equals to Long-Term Debt & Capital Lease Obligation plus Short-Term Debt & Capital Lease Obligation. British American Tobacco's annualized positive value of Interest Expense for the quarter that ended in Dec. 2025 was £1,916 Mil. British American Tobacco's average total debt for the quarter that ended in Dec. 2025 was £35,139 Mil. Therefore, British American Tobacco's annualized Effective Interest Rate on Debt % for the quarter that ended in Dec. 2025 was 5.45%.


British American Tobacco  (CHIX:BATSl) Effective Interest Rate on Debt % Explanation

Effective Interest Rate on Debt % measures the usage rate that a borrower actually pays on a debt.


British American Tobacco Effective Interest Rate on Debt % Related Terms


British American Tobacco Effective Interest Rate on Debt % Historical Data

* Premium members only.

The historical data trend for British American Tobacco's Effective Interest Rate on Debt % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

British American Tobacco Effective Interest Rate on Debt % Chart

British American Tobacco Annual Data
Trend Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23 Dec24 Dec25
Effective Interest Rate on Debt %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 3.57 4.02 4.55 4.75 5.35

British American Tobacco Semi-Annual Data
Jun16 Dec16 Jun17 Dec17 Jun18 Dec18 Jun19 Dec19 Jun20 Dec20 Jun21 Dec21 Jun22 Dec22 Jun23 Dec23 Jun24 Dec24 Jun25 Dec25
Effective Interest Rate on Debt % Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 4.72 1.53 7.87 5.37 5.45

CHIX:BATSL vs PM, MO, TPB: Effective Interest Rate on Debt % Comparison

For the Tobacco subindustry, British American Tobacco's Effective Interest Rate on Debt %, along with its competitors' market caps and Effective Interest Rate on Debt % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


British American Tobacco Effective Interest Rate on Debt % vs Tobacco Products Industry

For the Tobacco Products industry and Consumer Defensive sector, British American Tobacco's Effective Interest Rate on Debt % distribution charts can be found below:

* The bar in red indicates where British American Tobacco's Effective Interest Rate on Debt % falls into.


CHIX:BATSL
71GF Score
British American Tobacco PLC CHIX:BATSL
Effective Interest Rate on Debt % is just one metric. See GF Score™, valuation, warning signs, and more.
View Full Analysis

British American Tobacco Effective Interest Rate on Debt % Calculation

British American Tobacco's annualized Effective Interest Rate on Debt % for the fiscal year that ended in Dec. 2025 is calculated as

Effective Interest Rate on Debt %
=-1  *  Interest Expense/( (Total Debt  (A: Dec. 2024 )+Total Debt  (A: Dec. 2025 ))/ count )
=-1  *  -1927/( (36950+35070)/ 2 )
=-1  *  -1927/36010
=5.35 %

where

Total Debt  (A: Dec. 2024 )
=Long-Term Debt & Capital Lease Obligation + Short-Term Debt & Capital Lease Obligation
=32638 + 4312
=36950

Total Debt  (A: Dec. 2025 )
=Long-Term Debt & Capital Lease Obligation + Short-Term Debt & Capital Lease Obligation
=31708 + 3362
=35070

British American Tobacco's annualized Effective Interest Rate on Debt % for the quarter that ended in Dec. 2025 is calculated as

Effective Interest Rate on Debt %
=-1  *  Interest Expense/( (Total Debt  (Q: Jun. 2025 )+Total Debt  (Q: Dec. 2025 ))/ count )
=-1  *  -1916/( (35208+35070)/ 2 )
=-1  *  -1916/35139
=5.45 %

where

Total Debt  (Q: Jun. 2025 )
=Long-Term Debt & Capital Lease Obligation + Short-Term Debt & Capital Lease Obligation
=31904 + 3304
=35208

Total Debt  (Q: Dec. 2025 )
=Long-Term Debt & Capital Lease Obligation + Short-Term Debt & Capital Lease Obligation
=31708 + 3362
=35070

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

In the calculation of annual Effective Interest Rate on Debt %, the Interest Expense of the last fiscal year and the average total debt over the fiscal year are used. In calculating the quarterly data, the Interest Expense data used here is two times the semi-annual (Dec. 2025) interest expense data. Effective Interest Rate on Debt % is displayed in the 30-year financial page.

What does a Effective Interest Rate on Debt % of 5.45% mean?
British American Tobacco (CHIX:BATSL) has a Effective Interest Rate on Debt % of 5.45% as of Dec. 2025. Effective interest rate on debt is the rate a company actually pays on its debt. View historical data on British American Tobacco and its competitors.
Is British American Tobacco's Effective Interest Rate on Debt % too high?
British American Tobacco's current Effective Interest Rate on Debt % is 5.45%. Overall, British American Tobacco has a GF Score™ of 71/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does British American Tobacco's Effective Interest Rate on Debt % compare to PM and MO?
British American Tobacco's Effective Interest Rate on Debt % of 5.45% can be compared against companies in the Tobacco Products industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Effective Interest Rate on Debt % for a Tobacco Products company?
A good Effective Interest Rate on Debt % depends on the Tobacco Products industry context. However, Effective Interest Rate on Debt % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Effective Interest Rate on Debt % mean?
A high Effective Interest Rate on Debt % can signal that a stock is expensive relative to its fundamentals. Effective interest rate on debt is the rate a company actually pays on its debt. View historical data on British American Tobacco and its competitors. British American Tobacco's current Effective Interest Rate on Debt % is 5.45%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is British American Tobacco stock overvalued right now?
Based on GuruFocus' analysis, British American Tobacco (CHIX:BATSL) is currently considered Significantly Overvalued. The stock's GF Value™ is £27.87, compared to a current price of £43.74 — trading 56.9% above its estimated fair value. The current Effective Interest Rate on Debt % is 5.45%. British American Tobacco's overall GF Score™ is 71/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Effective Interest Rate on Debt % calculated?
Effective Interest Rate on Debt % is calculated from a company's financial statements. For British American Tobacco (CHIX:BATSL), the current Effective Interest Rate on Debt % is 5.45% as of Dec. 2025. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.

Is British American Tobacco (CHIX:BATSL) Overvalued in 2026?

Based on GuruFocus' analysis, British American Tobacco stock appears to be overvalued. The current stock price of £43.74 is trading 56.9% above its estimated GF Value™ of £27.87. GuruFocus considers British American Tobacco to be Significantly Overvalued.

Key valuation signals for CHIX:BATSL:

  • Effective Interest Rate on Debt %: 5.45%
  • GF Value™: £27.87 vs. price of £43.74 (56.9% above fair value)
  • GF Score™: 71/100 with 3 warning signs

No single metric tells the full story. See the CHIX:BATSL stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.


British American Tobacco Business Description

Address Globe House, 4 Temple Place, London, GBR, WC2R 2PG
The third-largest tobacco company by volume, British American Tobacco sold 465 billion cigarettes in 2025. Its leading brands are Dunhill, Kent, Pall Mall, Lucky Strike, and Rothmans in cigarettes. Its ownership of the Camel, Natural American Spirit, and Newport brands are limited to the US. In next-generation products, the company has the Vuse brand in vaping, Glo in heated tobacco, and Velo in modern oral tobacco. The company also owns a 22.9% stake in ITC limited, the largest Indian cigarette company.
71GF Score

Get the complete analysis for CHIX:BATSL

Effective Interest Rate on Debt % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.

£43.74
Price
£27.87
GF Value