Shares of ITC Ltd. are experiencing a modest recovery, having gained 6% since reaching a 52-week low on June 4, 2026. The Fast-Moving Consumer Goods (FMCG) conglomerate's stock had faced significant pressure, declining 12% in 2025 and an additional 20% in the current year, primarily due to a hike in tobacco taxes implemented in January 2026. This recent uptick has seen the stock turn positive across its 5-day, 10-day, and 20-day simple moving averages.
Brokerage Insights and Future Outlook
Amidst the recovery, several prominent brokerages have provided fresh analyses and price targets for ITC shares, reflecting varying perspectives on the company's near-term trajectory.
Kotak Securities Raises Fair Value
Kotak Securities has maintained a 'buy' recommendation for ITC, increasing its fair value target to Rs 365, up from Rs 330 previously. The brokerage identifies resistance for the stock between Rs 292-Rs 298 and support at Rs 284-Rs 280. Kotak's assessment indicates that while the volume impact on ITC's cigarette portfolio has been relatively contained (a 5-10% fall), the Earnings Before Interest and Taxes (EBIT) have seen a more significant 30% decline. This is attributed to partial tax absorption and adverse mix shifts, largely aligning with expectations.
At the current market price, ITC offers an attractive dividend yield of approximately 4.5%. Kotak estimates an 18% decline in cigarette EBIT for FY2027E, followed by a projected 14% growth in FY2028E.
Motilal Oswal: Neutral Stance
Motilal Oswal has assigned a 'neutral' rating to ITC, setting a price target of Rs 300. The brokerage highlights that positive factors, such as improving performance in the FMCG segment and normalization of paperboard margins, are currently outweighed by headwinds in cigarette earnings. These challenges stem from increased illicit competition, constrained pricing flexibility, and the inherent volume-versus-margin trade-off impacting ITC's immediate future.
Systematix Adjusts Target Downward
Systematix has reiterated a 'hold' rating on ITC, but has revised its price target downward to Rs 310 from the earlier Rs 340. The brokerage has lowered its revenue and EPS estimates for ITC by 2-4% for FY27E-FY28E, projecting a revenue/EPS Compound Annual Growth Rate (CAGR) of 6%/2% for FY26-FY28E. Systematix anticipates a cigarette volume decline of 8-10% in the first half of FY27 and a sharp net-realization decline in the first quarter of FY27, leading to an estimated FY27 volume and net sales decline of approximately 5% and 11% respectively. The revised target values the stock at an FY28E P/E of 18x.
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