ITC: Small buyers, HNIs now personal Rs 55,000 cr value shares in FMCG agency

 

With ITC flirting with its all-time excessive degree of Rs 354, shares owned by small particular person buyers and HNIs within the FMCG main have crossed Rs 55,000 crore mark in market worth. That is at the same time as retail buyers have back-to-back trimmed their stakes within the second greatest Nifty50 performer in 2022 thus far.

Information accessible with company database Capitaline suggests people holding as much as Rs 2 lakh value shares accounted for 11.46 per cent stake in ITC as of September 30. Alternatively, people holding over Rs 2 lakh shares accounted for 1.32 per cent stake within the firm.

At Tuesday’s market capitalisation of Rs 4,34,135.36 crore, the 2 investor classes held Rs 55,482 crore value of ITC shares. 

ITC commanded a market worth of Rs 2,68,633.5 crore as of December 31, 2021. Retail buyers (12.21 per cent stake) and HNIs (1.44 per cent stake) collectively held 13.65 per cent stake within the firm then. Their stake was valued at Rs 36,668.47 crore within the FMCG main on December 31.

The scrip has greater than doubled since October 2021 and is up 60 per cent in 2022 thus far. 

ITC has gained market share in cigarettes and that different segments have additionally been scaling up with portfolio and community enlargement, which augurs nicely for the Kolkata-based firm, mentioned analysts. 

The close to time period outlook stays constructive for the cigarette maker, given  a constructive cigarette quantity traction in a steady tax regime, a powerful pricing and advantages of backward integration in paper and paper board enterprise within the close to time period. 

Moreover, the corporate is seeing a structural restoration within the Motels enterprise, analysts mentioned.  

With no worth hikes within the close to time period, the federal government’s motion on curbing illicit cigarette will assist ITC to keep up quantity progress momentum within the cigarette enterprise, analysts mentioned. 

“Sturdy progress in non-cigarette FMCG enterprise, restoration within the resort enterprise and sustained sturdy progress within the PPP enterprise will drive double-digit income and PAT progress over the subsequent two years. The inventory presently trades at 24 instances and 20.9 instances its FY2023E and FY2024 EPS, which is at a reduction to some giant client items corporations,” mentioned Sharekhan. 

“Sturdy earnings visibility with enhancing progress prospects of core cigarette enterprise and margin enlargement in non-cigarette FMCG enterprise, together with a excessive money era potential and powerful dividend payout will cut back valuation hole within the coming years,” it mentioned whereas suggesting a goal of Rs 402 on the inventory.

Additionally learn: India’s FMCG biggies’ greatest hurdle: Faltering consumption in rural market

Additionally learn: ITC to HUL, how FMCG majors beat the slowdown blues in Q2, FY23