Shares of ITC Ltd today hit a 52-week high after reporting its financial results for the fourth quarter ended March 2022. The stock hit a 52-week high. In intraday trading, Rs 282.35 per share in Friday morning trading and the share is trading with a gain of 8.19 per cent for the last 5 days. ITC is now trading higher than the 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, indicating that the stock is in a bullish phase, and a debt-free one with debt-to-equity Have stock. Zero Ratio.
The financial performance of the company for the quarter ended March 2022 was favorable, as a result of which the company’s 111th Annual General Meeting (AGM) recommended a final dividend of Rs.6.25 per share (625%), as announced at the 111th Annual General Meeting (AGM), payment of final dividend. Will be done. Between Friday, July 22 and Tuesday, July 26, 2022, and ITC is currently trading on a high ROCE of over 33% with a high P/E of 22 times and a low P/B of 5.5. The stock has given a return of 35.27 per cent on NSE last year, which is much better than the (BSE 500) gain of 9.52 per cent. The company has an upside gap of 27.80 per cent on a year-on-year basis (YTD), while the benchmark Sensex is down 8.28 per cent.
Brokerage firm Sharekhan has given a buy rating to the stock with a target price of Rs. 320, based on the strong performance of the company. According to the brokerage, overall cigarette sales are expected to increase further as the government has not raised tobacco tax for the second year in a row.
The brokerage said in a report that “ITC delivered a resilient performance in Q4FY2022, with all businesses reporting double-digit revenue growth in Q4FY22. Gross revenue (including other operating income) grew 16% annually to Rs. 16,426.0 crores with 10% growth in Cigarette business, 30% growth in Agri business and 32% growth in Paperboard, Paper & Packaging (PPP) business. Gross revenue excluding agribusiness grew 13.9% in the fourth quarter. Gross margin declined by 117 bps due to higher inflationary pressures. OPM remained stable at 13.6% on a year-on-year basis. Operating profit and PAT increased 16.8% year-on-year and 11.8% year-on-year. For FY2022, revenue grew by ~23% (excluding agriculture business grew by 16.6%) and PAT grew by 15%. The total dividend for FY2022 is Rs. 11.5 per share vs Rs. 10.75 per share in FY21.”
“Cigarette sales volumes are expected to improve in the coming quarters. ITC has increased focus and redefined growth strategies across all its business verticals to improve growth prospects in the medium to long term. The stock is currently trading at 18.0x and 16.3x its FY2023E and FY2024 EPS, at a discount to some of the larger consumer goods companies. Strong earnings visibility with improved growth prospects of core cigarette business and higher cash generation potential with margin expansion and strong dividend payout (dividend yield of 4.3 per cent in FY22) in non-cigarette FMCG business Valuation gap in coming years will reduce We maintain Buy on the stock with a revised price target of Rs. 320,” Sharekhan said in a report.
The views and recommendations given above are those of individual analysts or broking companies and not of Mint.