BSE Code: | NSE Code: | ISIN: | Sector:
Research Report Detail
|Report Date||Call||Price@Call||Target Price
|Current Status||Time Horizon|
|Target Hit|| Long (1Y)
HDFC Securities maintains buy on ITC
ITC, number 4 company in terms of market capitalisation in India, has suffered at the hands of regulatory changes wherein a prior lenient GST rate under the new taxation regime was followed by an increase in the tax incidence for cigarettes. Cigarettes being the major source of revenue, the company's stock suffered. However, we feel that the market has overreacted and that other segments of the company, specifically the foods division under FMCG segment, the agri business and the hotels business have good growth potential and may drive up the profitability due to the efforts taken by company. With major capex in the hotels, foods business, reviving demand in the consumer segment, newer products in the agribusiness, and long term positive view on the cigarettes consumption in India, we expect company to drive up its profitability and get re-rated.