ITC's share price has been under pressure this year, largely due to British American Tobacco (BAT) selling its stake in the company, a 40% GST slab on "sin" goods, corrections in the FMCG sector, and caution due to ITC Hotels' demerger.
ITC shares have declined almost 12% year-to-date, compared to an 8% gain in the equity benchmark Sensex. Over the last two years, the stock has declined 6%, while on a longer timeframe of five years, the stock has delivered a solid return of 105%.
At the current juncture, when the market outlook is tinged with uncertainty-largely due to global factors-investors face a dilemma: is this the right time to buy the value stock? Mint spoke to fundamental and technical experts to gain insights into the stock. Here's what they said:
Fundamental views on ITC
According to Seema Srivastava, Senior Research Analyst at SMC Global Securities, ITC's financial performance reflects the strength of its diversified business model and its suitability as a long-term compounder.
Srivastava highlighted that cigarettes continue to provide stable cash flows, supported by premiumisation, demand resilience and relative tax stability, which helps offset cost pressures. The paperboards and packaging business, though facing import and cost headwinds, benefits from policy support like minimum import prices and anti-dumping measures, improving its medium-term outlook.
Srivastava said the focus of Budget 2026 on income tax relief, consumption push and front-loaded government spending, along with GST rate reductions across a large part of ITC's FMCG portfolio, is likely to boost affordability and demand over the medium term.
"Strong balance sheet, sustainability leadership, diversified earnings and steady cash generation make ITC well-positioned for long-term investors seeking stability with gradual growth," said Srivastava.
Divya Agrawal, Research Analyst and Advisory (Fundamental), Wealth Management, Motilal Oswal Financial Services, has a buy call on the stock with a target price of ₹515, citing that ITC remains a strong and stable business with multiple growth drivers.
"Its core cigarette business continues to perform well, supported by steady volumes, premium products and stable taxes. While margins have faced some pressure due to higher raw material costs, these are expected to ease, supporting profitability going ahead," said Agrawal.
"Overall, ITC offers steady cash flows, improving growth visibility and limited downside risk. As consumption demand recovers and margins improve, the stock offers long-term compounding potential for patient investors," said Agrawal.
Technical views on ITC
According to Jigar S. Patel, Senior Manager of Equity Technical Research at Anand Rathi Share and Stock Brokers, ITC is currently expected to trade within a well-defined range in the short term, reflecting consolidation and a lack of strong directional momentum.
"The stock has established a solid support base near ₹398, which has repeatedly attracted buying interest and is likely to act as a key demand zone during any corrective phase. On the upside, immediate resistance is placed around ₹412, and a decisive, sustained breakout above this level could provide fresh bullish momentum, potentially driving prices towards ₹418," said Patel.
However, Patel added that the broader structure suggests that ₹425 remains a major resistance zone, and only a convincing close above this level would confirm a stronger trend reversal.
"Once ITC manages to close above ₹425 on a sustained basis, it may offer a good accumulation opportunity, with an upside target of ₹495. Until then, traders can expect range-bound action between ₹398 and ₹418. The bullish view would be negated if the stock closes below ₹390 daily, which would signal weakness and invalidate the positive outlook," said Patel.
Pravesh Gour, Senior Technical Analyst at Swastika Investmart, highlighted that on the longer timeframe, ITC continues to display a strong long-term uptrend structure, despite the recent consolidation.
Gour highlighted that the earlier long-term resistance zone near ₹360-370 has now turned into a major support base, as highlighted by repeated monthly closes above this region.
As per Gour, the recent candles show smaller real bodies with lower volatility, indicating selling pressure is drying up rather than aggressive distribution. Volumes expanded sharply during the breakout phase and have since normalised, which is typical of a stock digesting gains before the next directional move.
"As long as ITC holds above ₹370 on a monthly closing basis, the broader bullish trend remains intact. On the upside, the ₹440-460 zone remains the immediate resistance area, followed by the all-time high band of ₹490-500, where selling pressure is likely to emerge," said Gour.
"A decisive monthly close above ₹500 would mark a strong bullish breakout and could trigger a fresh momentum phase, opening the path towards ₹600+ levels over the medium to long term. On the downside, ₹370 stands out as a crucial long-term support; as long as the stock holds above this zone, the broader uptrend remains intact. However, a sustained breakdown below ₹370 on a monthly closing basis may weaken the structure and expose the stock to the next major support around ₹300," said Gour.
source: Mint
Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
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