Motilal Oswal Financial Services has issued a buy call on ITC with a target price of Rs 450, indicating a potential upside of around 16% from the current market price of Rs 387.35. Let’s take a closer look at ITC, a large-cap company operating in the tobacco sector.
ITC, founded in 1910, is a well-known brand in India, offering a diverse range of products and services, including packaged food items, agricultural products, paper and paper boards, service (hotels), printed materials, and tobacco unmanufactured. The company has a market cap of Rs 480976.97 Crore, making it one of the largest companies in the Indian stock market.
Looking at the financials, for the quarter ended 31-12-2022, ITC reported a consolidated total income of Rs 18299.95 Crore, down -4.00% from the last quarter’s total income of Rs 19062.68 Crore and down -2.60% from the same quarter last year. However, it is essential to note that the company’s earnings outlook is better than other large-cap staples players on a two-year CAGR ending FY23E as well as FY24 earnings growth expectations.
In recent years, the tobacco sector has faced many challenges such as high inflation, unpredictable monsoons, continued weak rural sales, and delay in commodity costs decline. Despite this, ITC’s earnings performance in the last couple of years and FY24 is impressive. The company’s earnings outlook and financial stability have made it an attractive investment opportunity.
Therefore, the buy call on ITC with a target price of Rs 450 by Motilal Oswal Financial Services seems reasonable. Investors can consider investing in ITC, keeping in mind the risks associated with the tobacco sector and the stock market. Overall, ITC’s strong earnings outlook and financial stability make it a beacon of hope in an industry riddled with uncertainty.
| Company | ITC |
|---|---|
| Current Price | Rs 387.35 |
| Target Price | Rs 450 |
| Recommendations | Buy |
| Broker | Motilal Oswal |
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Broker reports provide analysis and recommendations based on the current market conditions and financial performance of a particular company. These reports often include target prices and buy, sell, or hold recommendations based on the analyst’s assessment of the company’s potential for growth and profitability.
