KR Choksey has given Buy recommendation for ITC with a target price of Rs. 310 in its research report issued on Feb 08, 2022

KR Choksey’s research report on ITC

Total revenue grew by 30.0% YoY (+23.7% QoQ) to INR 183,658 Mn which was above street estimates • EBITDA margin decreased 340 bps YoY (332 bps QoQ) to 30.5% while absolute EBITDA grew by 17% YoY (+11.6% QoQ) to INR 55,977 Mn • EBIT grew by 18.2% YoY (12.5% QoQ) to INR 51,681 Mn • While PAT grew by 15.0% YoY (9.2% QoQ) to INR 40,567 Mn, PAT margin contracted by 288 bps YoY and 293 bps QoQ to 22.1%

Outlook

We value ITC shares using an SOTP (Sum of the parts) approach implying 11.2x EV/EBITDA (previous 10.1x) on FY24E to Cigarette business; 19.4x EV/EBITDA (previous 18.8x) on Hotel segment; an average 6.0x EV/EBITDA (previous 5.5x) on Agri/Paper business; and 10.3x on EV/Revenue (previous 10.2x) on FMCG segment – we maintain our target price to INR 310 per share; an upside of 34.8% over the CMP. Accordingly, we maintain our “BUY” rating on the shares of ITC Ltd.

More Info on Trent

At 11:14 hrs ITC was quoting at Rs 219.55, up Rs 0.15, or 0.07 percent.

It has touched an intraday high of Rs 221.40 and an intraday low of Rs 218.60.

It was trading with volumes of 278,805 shares, compared to its thirty day average of 879,353 shares, a decrease of -68.29 percent.

In the previous trading session, the share closed down 5.57 percent or Rs 12.95 at Rs 219.40.

The share touched its 52-week high Rs 265.30 and 52-week low Rs 199.10 on 18 October, 2021 and 04 May, 2021, respectively.

Currently, it is trading 17.24 percent below its 52-week high and 10.27 percent above its 52-week low.

Market capitalisation stands at Rs 270,545.68 crore.

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