Mutual funds focus on ITC-stake falls for second straight quarter

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Mutual funds focus on ITC-stake falls for second straight quarter (Source: @ITCCorpCom)

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Mumbai: ITC has been buzzing recently of late- breaching the Rs. 300 per share mark. The stock is already up 38 percent this year and has been the second biggest gainer in the Nifty Index, as well. The focus remains on the mutual fund’s exposure to ITC. ITC is expected to report its Q1FY23 earnings on August 1.
Overall, the mutual fund holdings have fallen for the second-straight quarter in the month of June from 10.7 percent to 10 percent stake in the last six months. But the number of MF holding stakes have increased after 3 falling quarters from 308 mutual funds to 331. This biggest exposure held by a mutual fund is of SBI-ETF Nifty 50 Index, which held a 1.23 percent stake in the company. For the month of June- Invesco India Contra Fund Growth was the highest buyer of 27.3 lakh shares and Kotak Equity Arbitrage Fund Growth was the highest seller of 48.3 lakh shares. The top 3 funds holding a stake in ITC include SBI Nifty 50 ETF, SBI S&P BSE Sensex ETF and Parag Parikh Flexi Cap Regular Growth.

The key takeaways from the annual general meeting include Inflation remaining a key monitorable in the near term. FMCG Business is estimated to have a market potential of Rs 5 Lk Cr by 2030. The cigarette business has seen recovery and is ahead of the pre-pandemic levels and the single-use plastic ban gives immense opportunity in the paper & paperboard segments, as stated by the management. As for the hotel business, there is a healthy pipeline of new properties which will be opened over the next few quarters. The company is also evaluating the demerger of the hotel business.

According to Bloomberg terminal, 36 analysts have coverage on ITC and 33 of them have a ‘buy’ rating on the stock, while only 3 have a ‘hold’ rating. The Bloomberg consensus target price for the next 12 months stands at Rs. 309.5. The return potential shows an upside of 3 percent.

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