ITC‘s share price rocketed on Wednesday morning breaching the ₹500 mark for the first time. The stock went up over 3.5% to hit an intraday high of ₹510.65.

What Happened: This surge today comes as Finance Minister Nirmala Sitharaman‘s budget speech included no changes to tobacco taxation, bringing relief to ITC. Cigarette sales amount to a major chunk of the tobacco-to-hotels giant’s revenue.

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Jefferies also upgraded ITC from “hold” to “buy” and increased its price target to ₹585 from ₹435. The research firm highlighted ITC as a “clear winner” with stable tobacco taxes and likely unchanged goods and services tax (GST) until March 2026. Consequently, Jefferies upgraded ITC’s earnings per share (EPS) estimates by 1-2%.

Macquarie also raised its EPS estimates for ITC by 2% for FY25, FY26 and FY27, anticipating better volume growth due to the stable tax environment. It increased its price target to ₹560 from ₹535.

Kotak Securities also highlighted the positive impact of the Union Budget on ITC Ltd., noting that the government has maintained taxation on cigarettes. This stability is expected to drive 3-5% cigarette volume growth and 5-8% EBIT growth in the year ending March 2025. The analysts added that the stable tax regime benefits organised players like ITC, enabling them to gradually capture market share from illicit trade. The brokerage has an add” rating on the stock and has raised the target price to ₹500 from ₹465.

Price Action: ITC’s share price was up 1.98% to trade at ₹501.95 shortly after market open on Wednesday.

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.