ITC Ltd., a leading FMCG giant, has experienced a generally bearish trend throughout October, presenting a potential buy-on-dips opportunity for investors. The stock’s weekly performance is down by 0.5%, while on a month-on-month basis, it has delivered zero returns due to a 4.24% decline. ITC has also dropped below the ₹500 mark, currently trading at ₹486.65 per share. The company’s market capitalization stands at ₹6,08,682.29 crore, with a price-to-equity (P/E) ratio of 29.78x and a return on equity (ROE) of 28.29%. Year-to-date, the stock is up by 4%.
Brokerage firm Prabhudas Lilladher has issued an “Accumulate” rating on ITC stock with a target price of ₹541, indicating a potential upside of more than 11%. The brokerage forecasts ITC’s revenue to reach approximately ₹711.3 billion by the end of 2025, with a projected profit after tax (PAT) of ₹215.9 billion.
In a key strategic move, ITC is set to demerge its hotels business. The demerger will follow a ratio of 1:10, meaning shareholders will receive one share of ITC Hotels for every ten shares of ITC they hold. Following the completion of the demerger, ITC’s stake in the hotels business will be reduced, with 60% held directly by shareholders and ITC retaining a 40% stake.
Over the years, ITC has consistently rewarded its investors through dividends, bonus shares, and stock splits. Since July 2001, the company has issued 29 dividends, with a recent 12-month dividend payout of ₹13.75 per share, resulting in a dividend yield of 2.63%. ITC also has a solid history of issuing bonus shares, with three bonus issues to date. The most recent was a 1:2 bonus in July 2016, following similar bonuses in August 2010 and September 2005.
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