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ITC share price: Amid Annual General meeting (AGM) of the company, shares of ITC today hit a new 52-week peak of 299.50 apiece levels. ITC share price today opened with an upside gap and went on to hit its new 52-week high within an hour of opening bell today. After making its 52-week low of 204.35 on NSE in February 2022, ITC share price has been in uptrend and in these five months, it has surged more than 45 per cent.

According to stock market experts, ITC has a diversified portfolio as it has presence in FMCG, hospitality and cigarettes' business. As commodity prices have come down, ITC is expected to meet the customers expectations without raising its prices. Apart from this, unlock theme is also expected to help it raise footfall in its hospitality business. They also said that market is buzz with divestment in ITC and it is also working in favour of the stock, though there is not even a hint of any official statement (neither by the government or by the ITC itself).

Speaking on the reason for surge in ITC share price, Ravi Singhal, CEO at GCL Securities said, "After ease in commodity prices, ITC's FMCG business is expected to benefit as it is expected to enable the company to meet its customers' expectations without raising its products' prices. ITC has presence in hotel business as well. Due to unlock theme, this segment of the company is also expected get better footfall in comparison to last few quarters. ITC is in cigarettes' business as well and there is no such hint of raising taxes on cigarettes' as the current taxes are already at the highest levels."

Ravi Singhal of GCL Securities went on to add that the stock is getting benefit of doubt as well because market is buzzing with speculations that GoI may announce divestment of ITC in near term. However, neither the GoI nor any ITC officials have uttered any word in this regard. In fact, neither of the two have dropped a single hint in this regard. Singhal advised investors to discard this divestment trigger while making any investment decision in regard to the ITC shares. He said that ITC share price may go up to 340 levels in short term. Those who have this stock in their portfolio are advised to hold the counter with trailing stop loss at 265 whereas fresh buyers can buy the scrip in 275 to current levels, maintaining stop loss at 265 apiece levels.

Takeaways from ITC AGM

While speaking at the ITC AGM today, Sanjiv Puri, Chairman & MD at ITC said, "The year gone by was marked by heightened volatility in the operating business environment, especially in the first half. Despite these challenges, which were also compounded by severe inflationary headwinds, Gross Revenue of your Company grew by 22.7 per cent to over 59,000 crores whilst EBITDA rose to nearly 19,000 crores with an increase of 22 per cent. It is indeed heartening that, notwithstanding the near-term challenges, your Company continues to deliver robust growth across all business segments, though inflation remains a key monitorable. As valued shareholders, you will also take pride that your Company achieved several milestones in its sustainability journey with global distinctions in climate action, enhanced capacity in green infrastructure and new dimensions in inclusive growth."

Highlighting the fundamentals in regard to fundamentals of ITC that may attract investors, Sanjiv Puri said, "(ITC) has built and nurtured a portfolio of 25 world-class Indian brands in a short span of time with a superordinate vision to create and retain larger value in India. ITC is today the largest incubator of FMCG brands in India, anchoring competitive and inclusive value chains in wheat, potato, fruits and vegetables, dairy, aqua, forestry among others."

The ITC CMD went on to add that company’s interventions in the newer FMCG businesses have enabled robust growth of 25 per cent in revenue during the last two years of the pandemic, reaching nearly 16,000 crore in FY22. Despite the unprecedented inflationary headwinds, ITC sustained EBITDA margins last year and also improved margins by 650 basis points over the last 5 years. As part of the ITC Next strategy, the FMCG businesses continue to create structural competitive advantages and enhance profitability through a gamut of interventions.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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