ITC's Q2 results met expectations, with the company's consolidated profit increasing by 4% to ₹5,186.55 crore. Following this, foreign brokerage firms like Goldman Sachs, Morgan Stanley, and Citi have maintained their 'Buy' ratings on ITC and set new target prices ranging from ₹469 to ₹500.
ITC Share Price: FMCG giant ITC Ltd. announced its September quarter (Q2 FY26) results, reporting a 4% year-on-year increase in profit to ₹5,186.55 crore. Although revenue saw a slight decline, b growth was observed in the cigarette and FMCG businesses. Following the results, foreign brokerage firms are bullish on ITC. Goldman Sachs has given a 'Buy' rating with a target price of ₹490, Morgan Stanley with ₹469, and Citi with ₹500. Analysts believe that cost control, margin recovery, and stable demand will strengthen the company's future performance.
4% Growth Seen in Quarterly Results
ITC released its financial results for the September quarter on October 30. The company's consolidated profit increased by 4% year-on-year to ₹5,186.55 crore, compared to ₹5,054.43 crore in the same quarter last year. The company's total income saw a marginal decline, standing at ₹21,255.86 crore, down from ₹21,536.38 crore last year.
The company's total expenses decreased to ₹15,016.02 crore from ₹15,415.21 crore. This has improved the company's operating margin.
Cigarette and FMCG Businesses Drive Momentum
ITC's cigarette business played the most crucial role in the company's results. Revenue from this segment grew by 6.7% to ₹8,723 crore. Meanwhile, the non-FMCG segment recorded revenue of ₹5,964 crore, marking a 6.9% increase.
The company's Agri Business showed weakness, registering a 31.2% decline. Revenue from this segment fell to ₹3,976 crore. However, the Paperboard, Paper, and Packaging segment recorded a 5% increase, with revenue of ₹2,220 crore.
ITC states that it expects an increase in consumption in the coming months due to lower market inflation, a potential reduction in interest rates, and government policy support.
Morgan Stanley Also Expresses Confidence
Another global brokerage firm, Morgan Stanley, has also maintained a positive outlook on ITC. The firm has assigned an "Overweight" rating to the stock, setting a target price of ₹469.
Morgan Stanley stated that ITC's cigarette EBIT increased by 4.3% year-on-year, driven by product mix gains and cost control. The FMCG business recorded an EBIT of 9% and its margin exceeded 10%. Although the Agri Business showed weakness, its margin improved by 370 basis points.
Citi Brokerage Raises Target
Citi has also maintained its "BUY" rating on ITC and set a target price of ₹500. Citi noted that the company's revenue was impacted by the weakness in the Agri Business, but other segments showed b performance.
In its note, the brokerage stated that challenges like market competition and margin pressure exist for ITC, but tax policies and MRP-based benefits could provide long-term advantages to the company. Citi expects ITC's margins to recover by FY2027.
Although the brokerage has made a slight reduction of 1 to 2 percent in its earnings estimates for FY2026–2028, it believes that the company's fundamental position is b, and its long-term performance will be better.
