The hotels to tobacco conglomerate stock ITC in trade on July 4, 2022 has hit a fresh 52-week high of Rs. 293.3 per share. This is also the stock's 3-year high. Notably, the FMCG giant's all time low and all time high price are Rs. 4.14 and Rs. 367.7 per share, respectively. Likewise, the stock is trading almost 25% away from its all time high price.
Technicals of ITC
The stock on the previous trading day i.e. Friday (July 1, 2022) closed above its previous top of Rs. 282.35, gaining over 4% during the session to settle at Rs. 284.35 per share. On the daily scale, the stock with strong volumes established a big bullish candle. Likewise, on the weekly basis, there has been a formation of strong bullish candlestick patter, continuing Higher High Higher Low for third straight week.
No longer a meme stock- ITC gained 44% in last 1-year, more upside seen
The stock after 2 long decades of correction has been seeing price action and brokerage upgrades. The company's different businesses are said to be faring well as for say its hotel business has revived post the Covid blows, likewise its paper business is also reportedly making good money.
Within the Nifty FMCG, the ITC stock has made the highest moves in a year to the tune of 44%.
Brokerage firm Motilal Oswal in its latest report dated June 29, 2022 has assigned a 'Buy' rating to the stock for a target price of Rs. 335. This from the current price level of Rs. 292 means a potential upside of close to 15%.
The brokerage firm specifies the stock to be a good defensive play in the volatile market environment. "While valuations of global Tobacco peers have been restored to their pre- pandemic levels (Jan'19), ITC still trades at a 24% discount to its Jan'19 valuation
of 25.4x one-year forward EPS. We value ITC at 21x FY24E EPS, implying a 65% premium to its global peer average. We believe the premium multiples are justified, given its strong visibility over the medium term and the defensive nature of its business, especially in a volatile macro environment. We maintain our BUY rating on the stock with a TP of INR335", adds the brokerage firm.