ITC hits 52-week high; rises 12% in five days
The stock has surged 48.78% from its 52-week low of Rs 163.40 recorded on 29 October 2020.
Shares of ITC have surged 12.5% in five trading sessions from its previous closing low of Rs 216 on 15 September 2021. The counter hit a 52-week high of Rs 244.30 in intraday today. The stock has surged 48.78% from its 52-week low of Rs 163.40 recorded on 29 October 2020.
In the last month, the stock has moved nearly 18% higher outperforming the Nifty 50 index which rose 6.3% in the same period.
On the technical front, the stock’s RSI (relative strength index) stood at 87.022. The RSI oscillates between zero and 100. Traditionally the RSI is considered overbought when above 70 and oversold when below 30.
The stock is trading above its 50 and 100 days simple moving average placed at 211.80 and 209.28 respectively. These levels will act as crucial support zones in the near term.
ITC is engaged in the marketing of fast-moving consumer goods (FMGC). The firm operates through four segments: FMCG; hotels; paperboards, paper and packaging, and agribusiness. ITC is the market leader in cigarettes in India. The conglomerate reported a 28.6% rise in standalone net profit to Rs 3,013.49 crore on a 37.3% rise in net sales to Rs 12,142.43 crore in Q1 FY22 over Q1 FY21.
Brokerage view:
Geojit BNP Paribas | Rating: Buy | Price target: Rs 263
Barring a third Covid wave, ITC’s woes look to be gradually disappearing as its various businesses rebound to near pre-Covid levels. Despite the disruptions experienced during the quarter, the company made a strong recovery in both sales and margins over the last few quarters.
The brokerage firm expects further improvements in performance on steady demand recovery and therefore reiterate the ‘BUY’ rating on the stock with a revised target price of Rs 263 based on SOTP (Sum Of The Parts) valuation.
IDBI Capital | Rating: Buy | Price target: Rs 275
Demand in FMCG and Agribusiness is resilient. Inflationary raw material prices contributed towards gross margin contraction but operating profit remained healthy due to cost savings and judicious price hikes.
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