Live news , top stories, corporate news, company news, sector news, economy news, results analysis news, ceo interviews, fund manager interview, advisor interview, market news, bazaar talk, hot stocks news, ipo news, commodities news, mutual fund news, insurance news, news wire
27 May, 2020 06:23 IST
Edelweiss downgrades ITC to 'Hold' from 'Buy'
Source: IRIS | 18 Jul, 2017, 12.05PM
Comments  |  Post Comment

Edelweiss Securities has downgraded ITC to 'Hold' from 'Buy' with target price of Rs 304 as against current market price (CMP) of Rs 325 in its report.

Commenting on the investment rationale, Edelweiss said, ''In a negative surprise, the GST Council on Monday stepped in to check the windfall being reaped by cigarette manufacturers and increased effective tax under GST by ~10-11% which will result in MRP increase of ~8-9%. This with 6% hike in the Budget 2017-18 amounts to ~16-17% total hike in taxes for FY18. So, why was this unexpected? The Budget had sprung a positive surprise with mere 6% tax hike (lowest hike in past 6 years) coupled with relatively softer stance in earlier GST.

With per capita consumption 1/18th of China's, cigarette opportunity in India remains attractive over long term. Negative surprise on taxation front coupled with uncertainty will keep the stock under pressure. We value ITC on SoTP basis on FY19E and arrive at a target price of Rs 304. We downgrade to 'HOLD/SP' from 'BUY/SO'.

Disclaimer: IRIS has taken due care and caution in compilation of data for its web site. Information has been obtained by IRIS from sources which it considers reliable. However, IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website.


I T C Limited   (Q,N,C,F)*

Comments Post comment 
 Post Comment
Name Email
Security Code type    into this box
Technical Calls
Home  |   Shares  |   F&O  |   Mutual Funds  |   Loans  |   Insurance  |   News Centre
Wealth Tracker  |   Newsletters  |   Tax Corner  |   NRI Centre  |   Advertise
© All rights reserved. IRIS Business Services Limited
A Disclaimer