ITC share price continued to rise on Monday, increasing over 2% to Rs 239.40 per share on the BSE in intraday trade.
ITC’s stock price continued to rise on Monday, increasing over 2% to Rs 239.40 per share on the BSE in intraday trade. The stock rose over its historical high of Rs 239.15 per share, set on February 9, 2021. In the previous week, the ITC share price has risen more than 12%, compared to a 1.8 percent gain in the S&P BSE Sensex.
echnical analysts see ITC stock hitting Rs 250 apiece, a gain of a further 4.4 per cent from current levels, suggesting investors to buy the stock.
The firm Jefferies has maintained a strong Buy rating on ITC stock and increased its target price.
In its meeting on Friday, the GST Council made a number of changes to GST rates, including several big announcements. The council, on the other hand, made no changes to the cessation rates in any of the cessation areas, including tobacco. In a report, Jefferies said, “This is a positive development for ITC, which is also likely to witness a rebound in cigarette volumes and profitability in the coming quarters.”
Jefferies has maintained a strong Buy rating on ITC stock and raised its target price to $300 (from 275 before), with a 360-percentage-point upside scenario and a 190-percentage-point downside scenario.
Cigarette volumes are anticipated to recover in the next quarters, thanks to steady taxes and tailwinds from the economy opening up. The effect of the second wave was smaller even in Q1FY22 than last year, and recovery has been robust since mid-June 2021, according to the brokerage company.
Higher demand for packaged meals, health and hygiene goods helped FMCG in FY21. “Due to Covid, ITC suffered an Ebit loss of 5.3 billion dollars (3-4 percent of overall Ebit) in its hotels sector in FY21. Despite the influence of the second wave, the trend in 1QFY22 has been much better. “We anticipate the firm to reach Ebit break-even in 2HFY22, with travel rebounding and continuing cost management,” Jefferies noted. Overall, it expects ITC’s earnings to accelerate, with the cigarette industry leading the way.
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