ITC gains over 4%, hits 52-week high
Premium- ITC is a diversified conglomerate, which is a major player from cigarettes-to-hotels segments.
The retail favourite or meme stock ITC Ltd is finally making some noise on the D-street, with a continuous upward move in the current year.
ITC has finally got going this year, with the shares hitting 52-week high of ₹267.75 in Friday's intra-day deals. The stock gained over 4% and was last trading at ₹267.20 on NSE.
So far in 2022, ITC has gained nearly 22%.
ITC is a diversified conglomerate, which is a major player from cigarettes-to-hotels segments. It is also the second largest FMCG company in India with around 78% market share in cigarettes and presence in staples, biscuits, noodles, snacks, chocolate, dairy products and personal care products.
After tepid 12% return in last one year, Edelweiss Wealth is highly bullish on ITC shares. The Edelweiss Wealth research says that there is strong possibility of trend reversal and the stock may go up to ₹450 apiece levels in long term.
Edelweiss Wealth in a recent report said it expects ITC fundamentals to fuel share price. "We expect the volume in cigarettes to revive at a CAGR of 5% during FY22–24E as against a CAGR of -1 per cent during FY11–21; FMCG’s EBITDA margin to scale up to higher single digits; and the hotel, paperboard and agri-commodities businesses to revive. This will lead to an earnings CAGR of 12% in FY22–24E against a mere 7% in the last five years."
However, Kotak Institutional Equities expects high commodity prices to bite consumer goods companies such as HUL and ITC.
In staples, for companies such as Hindustan Unilever Ltd., ITC Ltd, Nestle India and Marico, Kotak expects negligible or negative volume growth and mid-to-high single digit value growth largely led by price hikes.
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ITC Ltd reported a consolidated net profit of ₹4,056 crore for the third quarter ending 31 December, 2022. This is an increase of 15%.
The conglomerate's revenue from operations surged 30% to ₹18,365 crore for the period under review as against ₹14,124 crore a year ago. Segment wise, revenue from cigarette business came in at ₹6,958 crore as against ₹6,091 crore in the last year period, which is an increase of 14% year-on-year.
The non-cigarette FMCG business or FMCG-others revenues increased by 9% to ₹4,099 crore during the third quarter.
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