Axis Securities maintains Buy on ITC, target price Rs 500

Axis Securities has maintained its Buy call on ITC with a target price of Rs 500. The current market price of ITC is Rs 436.3. ITC, incorporated in 1910, is a Large Cap company with a market cap of Rs 545991.05 crore, operating in the Tobacco sector.

ITC's key products/revenue segments include Packaged Food Item, Paper & Paper Boards, Agricultural Products, Others, Service (Hotel), Tobacco Unmanufactured, Printed Materials, Other Operating Revenue for the year ending 31-Mar-2024.

Financials

For the quarter ended 31-03-2025, the company has reported a Consolidated Total Income of Rs 19405.26 crore, up .10% from last quarter Total Income of Rs 19386.03 crore and up 4.29 % from last year same quarter Total Income of Rs 18606.53 crore. The company has reported net profit after tax of Rs 19709.47 crore in latest quarter.

The company?s top management includes Mr.Sanjiv Puri, Mr.Atul Singh, Mr.Alka Marezban Bharucha, Mr.Hemant Bhargava, Ms.Nirupama Rao, Ms.Meera Shankar, Mr.Arun Duggal, Mr.Shilabhadra Banerjee, Mr.Anand Nayak, Mr.Sunil Panray, Mr.Shyamal Mukherjee, Mr.Mukesh Gupta, Mr.Ajit Kumar Seth, Mr.Supratim Dutta, Mr.Sumant Bhargavan, Mr.Hemant Malik, Mr.Pushpa Subrahmanyam. Company has S R B C & Co. LLP as its auditors. As on 31-03-2025, the company has a total of 1,251 crore shares outstanding.

Investment Rationale
ITC?s cigarette revenue growth was strong at 6% YoY, led by 4% volume growth, while EBIT grew 4% YoY. EBIT margins declined by 120 bps YoY to 60.9% owing to higher RM (tobacco). However, this was partly offset by the improved mix and strategic cost savings. Axis Securities believes ITC?s long-term growth outlook remains intact. The stock is currently trading at 20x FY27E EPS, providing a margin of safety compared to peers.