Buy This Stock For 15% Return, Massive Growth In Hotels Business: Emkay Global

Brokerage firm Emkay Global has recently recommended investors to buy the stocks of ITC for a 15.20% return. ITC has footprints in multiple verticals like FMCG, Hotels, Paper, etc.

Target Price

The Current Market Price (CMP) of ITC is Rs. 234. Emkay Global has estimated a Target Price for the stock at Rs. 270. The company is expected to offer a 15.20% upside, in 1 year.

Stock Outlook
Current Market Price (CMP)	Rs. 234
Target Price	Rs. 270
1 year return	15.20%

Company performance

ITC delivered a strong performance in Q3 with EBITDA growth of 18% to Rs. 51bn (7% beat). Net sales grew 33% (16%, excluding agribusiness), driven by 13.6% growth in cigarettes, 9% in FMCG and strong growth in Paper/Hotels. ITC delivered a strong performance in Q3 with EBITDA growth of 18% to Rs. 51bn (7% beat). Net sales grew 33% (16%, excluding agribusiness), driven by 13.6% growth in cigarettes, 9% in FMCG and strong growth in Paper/Hotels. Other divisions' performance was robust, with sales/EBIT growth of 100%/50% in Agri, 38/57% in paper and turnaround in Hotels. The IT division's performance continued to see notable improvements, with 9MFY22 sales/PAT up 21%/48%.

Additionally, PTI reported that shares of ITC Ltd. on Friday gained nearly 2% after the firm reported a 15% increase in consolidated net profit for the third quarter ended December 31.

 

 

Comments by Emkay Global

Retaining buy rating, Emkay Global stated, "The company's revenue stood at Rs. 4,54,851 mn. Other divisions' performance was robust, with sales/EBIT growth of 100%/50% in Agri, 38%/57% in paper and turnaround in Hotels. The IT division's performance continued to see notable improvements, with 9MFY22 sales/PAT up 21%/48%. The IT business grew by 21%, with EBITDA/PAT growth of 42%/48% during 9MFY22. The Agri Business grew by 100%, with EBIT up 51% with robust growth in the value-added portfolio. Stability in taxes remains key for the industry to sustain steady volume growth and gains from illicit trades."

About the company

ITC is one of India's foremost private sector companies, has a diversified presence in FMCG, Hotels, Packaging, Paperboards & Specialty Papers and Agri-Business. ITC's aspiration to be an exemplar in sustainability practices is manifest in its status as the only company in the world, of its size and diversity, to be carbon, water and solid waste recycling positive. In addition, ITC's businesses and value chains create sustainable livelihoods for more than 6 million people, a majority of whom represent the poorest in rural India.

(Also read:  This Beverage Stock Has Potential To Grow 22%: Emkay Global Gives Buy Rating)

 

 

Disclaimer

The above stock was picked from the brokerage report of Emkay Global. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.