ITC hits all-time high; stock top gainer on Sensex

ITC share price: Shares of ITC, the diversified conglomerate, hit an all-time high of Rs 489.10 apiece on the BSE on Thursday, July 20. At the time of writing this news, the stock was trading 1.60 per cent higher at Rs 486.50 on the BSE.

Earlier this month, the company said its board had recommended the reappointment of Sanjiv Puri as the company’s chairman and managing director for a second term of five years.

The resolution seeking his reappointment as chairman and managing director of the diversified conglomerate will be put to vote at the company’s annual general meeting to be held on August 11, 2023, according to a notice sent to the shareholders on Tuesday.

The company under Puri drove the ‘ITC Next’ strategy in the last four years, encompassing digital acceleration, cost optimisation, investing in new growth vectors, and ensuring supply chain agility, PTI reported, citing company officials.

Revenue from the company’s FMCG segment has grown from Rs 12,500 crore to Rs 19,123 crore during the period, and segment EBITDA margins improved by 7.7 per cent between 2016–17 and 2022–23. Its other verticals like hotels, agri-business, paperboards, paper, and packaging also registered improved performance in the last four years, the PTI report said further.

What to expect in Q1 earnings

Analysts at HDFC Securities have modelled 12 per cent year-on-year (YoY) growth in cigarette revenue, with volume growth of 10 per cent YoY (4% 4-year CAGR). The non-cigarette business is expected to fall 9 per cent YoY (impacted by agribusiness).

"We model 14 per cent YoY growth in FMCG. We expect cigarette earnings before interest, and tax (EBIT) to grow by 13 per cent YoY. We model FMCG's EBIT margin at 8 per cent as against 4.6 per cent YoY. EBITDA to grow by 11 per cent YoY," the brokerage added.

Key things to track: 

• Continued Cigarette volume and mix improvement
• FMCG business EBIT margin
• Continued positive paper cycle
• Outlook on Agri and Hotel businesses