Buy ITC; target of Rs 347: Sharekhan

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26 Aug, 2025 12:21

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Sharekhan's research report on ITC

ITC registered mixed performance in Q4FY2019 with revenue growing by a strong 13%, while the 87 bps decline in OPM limited growth in operating profit to 10.3%. Revenue from cigarette grew by ~11%, driven by 8-9% volume growth, PBIT margins were down by 77 bps largely due to a largely unfavourable revenue mix. Growth in cigarette sales volumes to sustain in near term on minimal price hikes; paperboard, paper & packaging and hotel businesses would keep growing in double digits.

Outlook

Discounted valuations at ~23x its FY2021E earnings as compared to some large peers makes ITC a better pick in FMCG space; we maintain our Buy rating with an unchanged PT of Rs. 347.

For all recommendations report, click here

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