ITC‘s share price started the day in the green as the company posted its earnings for the quarter ended June.

What Happened: ITC’s consolidated net profits for the quarter came in at ₹5,104.9 crore, up 16% from the ₹4,389.8 crore profit it booked in the same quarter last year. The tobacco-to-hotels company’s revenue from operations stood at ₹18,639.48 crore, down over 5% from ₹19,695.12 crore in the June quarter of 2022.

The company’s cigarettes segment brought in the major chunk of revenue at ₹8,355.66 crore, registering a growth of 12% from the year-ago period. EBITDA for the period came in at ₹6,670.07 with an EBITDA margin of 35.8%.

The company also announced more details about the merger. For every 10 shares of ITC, shareholders will get one share of ITC Hotels. The listing is expected to happen in the next 15 months.

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Analyst Reactions: CLSA maintained its ‘outperform’ rating on the stock with a price target of ₹480. The global brokerage firm added that the company’s cigarette and other fast-moving consumer goods segments make up for the difficulties in the agri and paper business.

JP Morgan also maintained the ‘overweight’ rating on the stock with a target price of ₹475. The firm said the company’s EBITDA was in line and the performance of the FMCG segment was impressive.

Morgan Stanley also remained ‘overweight’ on the stock raising the price target to ₹493 from ₹474. The firm said that the company’s numbers beat its expectations and the earnings performance bodes well for stock performance.

Price Action: ITC”s share price was up 0.49% to trade at ₹451.40 as the markets opened on Wednesday.

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