ITC: expecting profit to increase due to price increase
About ITC:
ITC Limited or ITC is an Indian conglomerate headquartered in Kolkata, West Bengal. Its diversified business includes four segments: Fast Moving Consumer Goods, Hotels, Paperboards, Paper & Packaging and Agri Business.
Fundamentals
- Cigaratte price of gold flake premium & classic milds is increased from Rs. 7 to Rs. 7.5. According to the research done by share khan, local retailers are selling these cigarattes at Rs. 8
- Cigarattes have inelastic demand and price increase will work in positive for the company which is good from investors point of view.
- Increased price will improve margin of the company.
- Presently ITC stock is trading at approx 28x . With expected profit going up, I expect that price of the share will go up in medium term.
- Target price: Rs.379
Technicals
Technically, the stock is getting momentum. The price increase has already shown effect with price increase from Rs. 295 to Rs. 308 in a single day. MACD is already shown crossover.
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