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Last Updated : Oct 24, 2011 04:56 PM IST | Source: CNBC-TV18

ITC's cigarette margins will continue to go up, say experts

The ITC Q2FY12 numbers were inline with our expectations, said Himani Singh, equity research analyst at Elara Capital and Sanjay Manyal, research analyst at ICICI Direct. Singh feels that the company would surprise on the positive side for this financial year. Manyal stressed on being positive on the cigarette margins.


Cigarette major ITC's second quarter FY12 sales numbers were up 17.5% at Rs 5,945 crore versus Rs 5061.2 crore and the profit after tax (PAT) was up 17.9% at Rs 1470 crore versus Rs 1246.7 crore.


The ITC Q2FY12 numbers were inline with our expectations, said Himani Singh, equity research analyst at Elara Capital and Sanjay Manyal, research analyst at ICICI Direct. Both shared a common view that the cigarette margins would continue to go up.


While Singh sets a target price of Rs 241 for the stock, Manyal remains positive on 226 levels target.


Moreover, Singh feels that the company would surprise on the positive side for this financial year. Manyal stressed on being positive on the cigarette margins.


Here is the edited transcript of their interview. Also watch the accompanying video.


Q: What is your first take on the ITC numbers?

Singh: ITC has had a very robust topline growth of around 18%, whereas our expectation was 17.5%. The company has given a positive result on the topline as well as on the bottomline. For the bottomline, they exceed our estimated by 2%. We are fairly in line with their estimates. We have had expected a price hike in terms of VAT. The state, which had taken VAT increase, we didn

First Published on Oct 24, 2011 03:05 pm
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