ITC share price soaring! Is it gaining from Budget 2021 announcements?
Budget 2021: Why has the ITC stock price been rising for the last two trading sessions? What has impacted the price, the most after the Budget 2021 announcements? Zee Business’ Senior Research Analyst Varun Dubey gives this interesting analysis
Budget 2021: Why has the ITC stock price been rising for the last two trading sessions? What has impacted the price, the most after the Budget 2021 announcements? Zee Business’ Senior Research Analyst Varun Dubey gives this interesting analysis.
Dubey said that if the yesteryears’ budgets are taken into account, then this budget was a non-event for the FMCG sector as no major announcements were made on this sector. He said that the fact that no major announcements were made for FMCG is good news for ITC.
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How has ITC stock benefitted?
Dubey said that ITC stock has benefitted as the government has not increased any tax on cigarettes in this year's Budget 2021. This is a big relief for the company, Dubey said. He said that as a result of this, the Stock price of ITC has been gaining over the last two trading sessions.
Today, the stocks of ITC ended the day in green, gaining by over 1 per cent on the NSE. It closed at Rs 218.45.
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बजट में FMCG के लिए हुए ऐलानों पर ब्रोकरेजेज
— Zee Business (@ZeeBusiness) February 2, 2021
Brokerage JP Morgan has increased its target price from earlier Rs 225 to now Rs 255 with a Buy recommendation on it.
There is negative news for this company too - tax on palm oil getting raised. Though the excise duty has been reduced, but the cess on it will increase the overall tax outgo, he further said. And this will impact all the FMCG companies, he said.
This will also have an adverse impact on HUL and Godrej Consumers as palm oil is being used in palm oil. This could lead to increase in soap prices or the companies could be forced to take a hit on their margins.
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