Increase in cigarette price will increase profit of ITC

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.

 

Sell Titan Industies with a target of 238

Sell Titan Industries

Fundamentals

Titan has been showing very weak trend since last year. The stock has been following because of the volatility in gold price. With the economic condition of country not being the best. It is recommended to be away from this stock for short term and enter this stock when the gold prices become stable.

Technicals

Technically Titan is showing weak trend. EMA and MACD both giving a negative cross over. click below to see the chart

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