ITC shares are a ‘buy’ for 92% analysts who track the stock; Check their price targets

Most analysts covering FMCG major ITC Ltd. have maintained a positive stance on the stock, believing that most headwinds are now behind.ITC reported a mixed set of numbers for the June quarter. While revenue growth was strong, margins fell short of expectations. The company reported early signs of a recovery in urban consumption demand during the quarter.

What worked
– Strong revenue beat led by Cigarettes and Agri Trading.- Cigarette volume growth stood at 6%, hitting a multi-quarter high.

– The Agri business outperformed, with revenue rising 39% year-on-year to ₹9,685 crore.

– The FMCG segment reported 5.2% YoY revenue growth to ₹5,777 crore.

– FMCG EBITDA margins improved by 60 bps QoQ.

What didn’t

Sharp contraction in margins led by:

– Leaf tobacco inflation, which impacted cigarette EBIT by 220 bps

– FMCG margin decline of 180 bps YoY

– Weakness in Paper business EBITGlobal brokerage firm Citi has maintained a ‘Buy’ rating on ITC, with a price target of ₹500.

The company reported a 21% year-on-year growth in Q1 revenue, while EBITDA and PAT rose 3% and 2% YoY, respectively.

Cigarette revenue increased 8% YoY, with an estimated 7% volume growth, driven by a stable tax environment and market interventions. However, margins remained under pressure due to the impact of high-cost leaf tobacco, a trend likely to persist into FY26.

The FMCG segment showed improved growth, while the paperboard business continued to face headwinds.

Goldman Sachs also has a ‘Buy’ rating on ITC, with a target price of ₹490, noting that Q1 FY26 results were broadly in line with estimates.

The brokerage mentioned strong cigarette performance, with margins expected to recover in the second half of the fiscal. FMCG growth continues to improve, with margin recovery also likely in H2.

While the paper business margins weakened, Goldman believes they may have bottomed out. The firm expects earnings growth to accelerate in H2 FY27.

Macquarie has an ‘Outperform’ rating on ITC, with a target price of ₹500, maintaining a constructive view on growth prospects, despite ongoing weakness in the paper segment.

Jefferies also has a ‘Buy’ rating, with a target price of ₹535.

Of the 39 analysts that have coverage on ITC, 36 of them have a ‘Buy’ rating, two say ‘Hold’, while one has a ‘Sell’ recommendation on the stock.

Shares of ITC settled 1.1% higher on Friday at ₹416.65, ahead of the earnings announcement. The stock is still down 14% on a year-to-date basis.