Budget 2024: On Wednesday, July 24, stock of ITC increased by over 4% to cross ₹500 for the first time, building on gains from the previous session’s 5.5 percent increase.
The stock was upgraded to a “buy” by brokerage firm Jefferies on July 23, following Finance Minister Nirmala Sitharaman’s announcement in her budget address on July 23 that there will be no changes to tobacco taxation. With a target price of ₹585, Jefferies has projected a possible upside of 15.5% for ITC.
ITC Shares Surge to New High Amid Strong Performance
![ITC Shares Surge to New High Amid Strong Performance](https://powercorridors.in/wp-content/uploads/2024/07/itccccc-300x180.png)
During intraday trading, the stock rose as much as 3.7 percent, hitting a new high of ₹510.60. ITC has increased by 10.5 percent in the last year and by 4.4 percent in the last month alone. Notably, the stock has increased by more than 19% so far in July and by around 28% since it reached its 52-week low of ₹399.30 on March 12, 2024.
The National Calamity Contingent Duty (NCCD) was significantly increased by 16 percent last year, which led the Finance Minister to decide to maintain tobacco taxation at its current level. ITC is now among the top performers on the Nifty 50 and Sensex benchmark indices thanks to its consistency.
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Jefferies Optimistic on ITC; Rural Demand and Tax Savings to Boost FMCG Sector
![Jefferies Optimistic on ITC; Rural Demand and Tax Savings to Boost FMCG Sector](https://powercorridors.in/wp-content/uploads/2024/07/jefferies-300x180.png)
Jefferies said, “no news is great news” for ITC, emphasizing the company’s substantial benefits from the remaining tobacco taxes and probably steady GST rates through March 2026.
Furthermore, the outlook for the staple sector’s demand is getting better. It is projected that a recovery in rural demand will help ITC’s non-tobacco industries, like FMCG and agriculture. This optimistic view was reinforced when the Finance Minister allocated 12% more for rural areas in the Union Budget.
Experts also noted that people will save about ₹17,500 in net tax savings as a result of the Finance Minister’s announcement of higher tax rates under the New Tax Regime and greater standard deductions from ₹50,000 to ₹75,000. Along with ITC, this is anticipated to assist businesses in the FMCG sector, such as HUL, Dabur, and Nestle.