KR Choksey's research report on ITC Ltd
ITC Ltd posted its Q1FY18 results which were in-line with our estimates, Net revenue for Q1FY18 reported at INR 138004.2 Mn which showed a growth of 4.1% yoy and de-growth by 8.1% qoq. EBIDTA during the quarter improved to 27.1% and stood at INR 37464.0Mn with an increase of 54bps yoy and 133bps qoq. PAT after exceptional item for Q1FY18 stood at INR 25605.0Mn with improvement in PAT margin at 18.6% which was an increase of 56bps yoy and 77bps qoq.
Outlook
We expect ITC Ltd to post its revenue growth around 10-12% in FY18E & FY19E and growth will be driven mainly by its FMCG and other businesses. At the CMP of INR 289, ITC is trading at an EPS of INR 10.8 its FY19E. We recommend ‘BUY’ rating on the stock, with a target price of INR 349 that offers a potential upside of 20.7%.
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