360 ONE retains ITC Buy, sets ₹440 target implying 68% upside
The brokerage expects cigarette pricing to support margin recovery, alongside healthy FMCG demand and paperboard expansion. It also flags ITC’s proposed Happiest Minds transaction as a longer-term IT-services catalyst, despite expected FY27 cigarette-volume pressure.
What happened
360 ONE retained a BUY on ITC with a ₹440 target, citing cigarette pricing-led margin recovery, healthy FMCG demand, paperboard expansion and IT exposure
Key facts
- 360 ONE target price: ₹440 per share
- Current/previous close: ₹262.20 per share
- Implied upside: 68%
- FY27 cigarette-volume assumption: -4%
- ITC Infotech promoter-stake acquisition in Happiest Minds: 22.1% for ₹13.3 billion
What changed
360 ONE retained a BUY on ITC with a ₹440 target, citing cigarette pricing-led margin recovery, healthy FMCG demand, paperboard expansion and IT exposure through the proposed Happiest Minds transaction, despite expected FY27 cigarette-volume pressure.
Why this matters
ITC’s margin recovery outlook rests on cigarette pricing, sustained FMCG demand and paperboard expansion, though FY27 cigarette-volume pressure remains a planning risk.
What to watch
- Sequential cigarette EBIT-margin expansion despite volume softness.
- Management commentary confirming limited elasticity from price increases.
- Sustained FMCG revenue growth with narrowing or positive segment EBIT losses.
- Paperboard volume growth and stable pricing after expansion commissioning.
- Formal announcement, regulatory clearance or revised structure for the Happiest Minds transaction.