Shares of ITC Ltd declined in early trade on Tuesday, slipping 0.40% to ₹321.50 on the NSE, compared to the previous close of ₹322.80. The stock movement comes after a foreign brokerage firm Nomura reiterated its ‘Reduce’ rating on the FMCG-to-cigarettes major, while maintaining its target price at ₹318 per share. Over the past six months, ITC shares have seen a sharp correction, falling 22.87%, reflecting continued pressure on the stock amid cautious analyst outlook and broader market volatility.
Despite the muted stock performance, the company recently announced an interim dividend of ₹6.50 per equity share of face value ₹1 for the financial year ending March 31, 2026. The board has fixed Wednesday, February 4, 2026, as the record date to determine the eligibility of shareholders entitled to receive the dividend. Investors holding ITC shares in their demat accounts as of February 4 will qualify for the payout, while the dividend will be credited between February 26 and February 28, 2026.While the interim dividend provides near-term support to investor sentiment, the brokerage’s cautious stance suggests limited upside potential in the stock at current levels, keeping ITC shares under pressure in the short term.
The brokerage said that while lower-than-expected price hikes could cushion volumes, Ebit margins and growth were likely to be impacted more than earlier expected if ITC did not implement further price increases during the year. Nomura valued ITC on a sum-of-the-parts basis and forecast a flat earnings per share compound annual growth rate over FY26-28F. “Our target price of Rs 318 implies a P/E of 20x on Dec-27F EPS,” it said. Key upside risk cited is stronger-than-expected volume growth. ITC has been the worst-performing BSE200 stock, falling 20 per cent in 2026 so far.Nomura said most price hikes were at around 30 per cent, compared with its expectation of 35-40 per cent, following the sharp tax hike of 40-45 per cent effective from February 1. Nomura noted that portfolio-level actions had made ITC more competitive, but cigarette Ebit margin and growth were likely to decline more than expected.
On February 6th ITC shares gained nearly 6 percent to trade at Rs 327.7 apiece on Friday, snapping a two-session losing streak. The stock later pared some gains to close at Rs 326.35 (up more than 5 percent).ITC in January reported a 6.4 percent YoY rise in net profit to Rs 5,087.87 crore for the October-December quarter of FY26, as against Rs 5,436.3 crore in the same period of the previous financial year.The company’s revenue from operations meanwhile surged 6.66 percent to Rs 21,706.64 crore during the quarter under review.