ITC Ltd. shares witnessed a sharp uptick following the release of its Q4 FY25 earnings, reflecting a resilient performance amid a challenging economic environment. The stock climbed 3% intraday, driven by investor optimism over the company’s steady growth and strategic outlook.
Q4 Earnings Snapshot
ITC reported a net profit of ₹19,562 crore, significantly boosted by a one-time exceptional gain from discontinued operations. Excluding this, the company’s adjusted profit rose 3% YoY to ₹5,155 crore, showcasing stability in its core business. Revenue from operations stood at ₹20,376 crore, marking a 10% YoY increase.
Key Growth Drivers
- Cigarette Business: ITC’s flagship segment maintained steady growth, with revenue rising 6% YoY to ₹8,399.6 crore.
- FMCG Segment: The company’s consumer goods division saw marginal revenue growth, while margins improved due to declining palm oil prices.
- Agribusiness Expansion: Strong exports of agricultural products contributed to a 17% YoY revenue increase.
- Dividend Announcement: ITC declared a final dividend of ₹7.85 per share, bringing the total FY25 dividend to ₹14.35 per share.
Brokerage Recommendations
Leading brokerages remain bullish on ITC’s prospects:
- Goldman Sachs: Maintains a ‘buy’ rating with a target price of ₹490 per share.
- HSBC: Expects FMCG margins to improve, setting a target price of ₹510 per share.
- CLSA: Retains an ‘outperform’ rating, citing 9% YoY revenue growth, with a target price of ₹496 per share.
Investor Outlook: Buy, Sell, or Hold?
With strong fundamentals, a stable tax environment, and expected rural demand recovery, ITC remains a solid long-term investment. Analysts suggest holding for steady returns, while new investors may consider buying on dips for potential upside.
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