ITC reached 5-year high after quarterly results, experts predict further growth

From hotels to FMCG and cigarette maker, the shares of this company are consistently performing well. So far this year, the share of ITC has increased by 62 percent.

ITC Share Price : The buying of shares has increased on the excellent quarterly results of ITC, a giant associated with the FMCG sector, related to business from cigarettes to hotels. That is, after the quarterly results, ITC’s shares have reached a 5-year high. Its shares reached a record high of Rs 354 in intra-day on BSE on Friday. However, after this there was a slight softening in the price due to profit booking and it fell down and closed at Rs 344.85.

Stock market experts believe that the shares of ITC are expected to remain bullish even further. According to domestic brokerage firm ICICI Securities Analysts, ITC shares may hit a record high of Rs 400, which is 15 per cent upside from the current price. Let us tell you that a few years ago the shares of ITC were falling continuously.

From hotels to FMCG and cigarette maker, the shares of this company are consistently performing well. So far this year, the share of ITC has increased by 62 percent. Let us inform that among global brokerages, CLSA has maintained its outperform rating on the stock with a target of Rs 375. Beating market expectations, ITC’s net profit jumped nearly 21 per cent year-on-year to Rs 4,466 crore for the quarter ended September. The revenue-net of excise duty had increased by almost 27% to Rs 16,129.91 crore. At the same time, the revenue from the cigarette business grew by more than 23% annually to Rs 6,953.80 crore.

Motilal Oswal gave four major reasons for being positive on ITC –

  • Better-than-expected demand recovery and a healthy margin outlook for cigarettes
  • Healthy sales momentum in FMCG business
  • Smart recovery from hotel business
  • Better capital allocation in recent years

business growing at a steady pace

Motilal said a stable tax environment for cigarettes in recent years has allowed ITC to check price hikes to avoid demand disruption. This trend is expected to continue, resulting in improved cigarette volumes and earnings visibility in the medium term. With continuous improvement in margins over the last five years, ITC’s FMCG business is also growing at a steady pace.

read this also



Business will get faster pace

The large opportunity size of the existing food items (flour, biscuits, juice, noodles, snacks, chocolate and dairy) portfolio will help the business grow at a faster pace than other FMCG companies. Hotel business has exceeded 70% and ARR in occupancy levels. According to ICICI Securities, they are above pre-pandemic levels. It will continue to grow at a fast pace keeping in mind the increasing demand in the near term. Stating that the Q2 numbers were ahead of expectations on all fronts, Kotak has upgraded its FY2023-24 EPS estimates by 5-6%.