ITC Ltd. share price target

GST implementation may lead to a levy of a sin tax of 40% on cigarettes in addition to the prevailing excise duty structure. The sin tax will replace the state VAT which is currently at 26.5% on a blended basis as per our estimates. This hike is significant and it will have a significant impact on the cigarettes business volume and profit growth. While the impact is significant, we find ITC is preparing ground for GST implementation by taking calibrated price hikes and steadily increasing the share of sub-65mm cigarettes. Post the implementation of GST, the profit growth trajectory for ITC will improve significantly as GST will remove various distribution inefficiencies. We maintain our Buy recommendation on ITC with a target price of Rs 300 after baking in the negative impact of GST implementation starting from FY18.

Q1FY17 was marked by a challenging operating environment due to continuing pressure on legal cigarettes industry volumes and sluggish demand conditions in FMCG Due to lack of clarity on new rules pertaining to health warnings on the packs, ITC's cigarette factories were shut from 1st April to 15th April 2016 and from 4th May to 8th May 2016 this impacted production Our channel checks suggest that in Maharashtra (~10% of sales volume), seizure of...

ICICI Securities Ltd | Retail Equity Research ITC reported revenue growth of 8.3% YoY to | 13156.7 crore for Q1FY17. Adjusting for the impact of Ind AS, revenues stood at ~| 9957.7 crore (I-direct estimate: | 9679.4 crore). The company saw robust growth of 20.2% in agri business while cigarette business grew by 6.4%. In FMCG, 9.5% growth was largely driven by volumes. However, hotels & paperboard segments reported subdued performance with de-growth of 0.2% & 1.6% respectively...

ITC's 1QFY17 operating performance was in line with estimates. Net revenues (Ind AS) increased 9.8% YoY (est. 10%) to INR 100.5b. EBITDA margin decline stood at 40bps over a very high base in 1QFY16 (vs. our estimate of 100bps decline) while PAT before other comprehensive income (Ind AS) grew 10.1% YoY (est. 10%) to INR 23.8b. Absolute Sales, EBITDA and PAT numbers differ from our estimates due to IND AS adjustments. We reckon cigarette volumes were up 3% YoY (best numbers since 4QFY13 and better than our expectation of 1% increase) aided by higher growth in the...

Key highlights of ITC's Annual Report 2016:Excise duty collection increased in FY16: The Union government hiked excise duty on cigarettes by 22%/18%/25%/16% in Union Budget FY13/14/15/16. Excise duty paid to government by ITC’s cigarettes business rose 9% yoy in FY16 to Rs 149bn vs. 27%/13%/0% in FY13/14/15. Excise duty revenue for the government increased, even as volumes fell 3%/6%/9% in FY14/15/16.Phillip Capital maintain a BUY with a TP of 375.

Trendlyne has 1 report on ITC updated in the last year from 1 broker with an average target of Rs 375.

ICICI Securities Ltd | Retail Equity Research For Q4FY16, ITC reported healthy net sales growth of 9.5% YoY to | 10062.4 crore (I-direct estimate: | 9531.5 crore) driven by 10.2%...

The government increased excise duty on cigarettes by only 10% yoy in FY17 as compared to ~18%/25%/16% in FY14/15/16 We believe that the current budget's outcome is positive for ITC, and will help it to...

ITC posted a healthy set of numbers for 4QFY2016, both on the top-line and the bottom-line front. The top-line was strong due to higher growth in Cigarettes & Agri businesses; however, higher taxes slightly dragged down the overall profitability of the company. Key highlights: ITC's net sales for the quarter grew by 9.4% yoy to Rs10,1..

Background: ITC, with revenues in excess of $7bn, is a market leader in Cigarettes with about 70+% volume share and 85+% value share. Cigarette business is a cash cow accounting for 50% for Sales and ~ 81% of EBIT. To diversify away from cigarettes with a long term perspective, they have other businesses such as FMCG, Hotels, Paperboards, Packaging, Agri-Exports, Branded Apparel & Stationery. ITC also a rural initiative with 6500 `e-choupal's aimed at farmers for...

ITC has posted spectacular set of results in 4QFY16. The Company has topped our sales estimates by 5% while exceeding EBITDA estimates by 7%. ITC's net sales grew by 9.5% to Rs100.6bn and EBITDA came in at Rs35.8bn for 4Q. Notably, its net profit at Rs25bn came largely in line with our estimates due to higher tax outgo during the quarter. We expect ITC to post revenue and earnings CAGR of 12.1% & 13.3%, respectively through FY16-18E and maintain our BUY recommendation on...