The Shocking Truth Behind ITC’s Share Price Movement This Week
Introduction
This week, ITC’s stock price sent shockwaves across Dalal Street. Investors rubbed their eyes in disbelief as the scrip either spiked or slumped significantly—depending on the day—making it one of the most talked-about stocks in the Indian market. But what really caused this drama? Was it just market noise or something deeper?
Let’s pull back the curtain and get to the truth behind ITC’s surprising share price movement this week.
Understanding ITC’s Business Model
ITC isn’t your average company. It’s a sprawling conglomerate with business interests ranging from tobacco and FMCG to hotels, paperboards, and agribusiness. This wide reach is both its strength and complexity.
FMCG and Tobacco: The Core Pillars
While ITC has successfully expanded into fast-moving consumer goods (FMCG), the tobacco segment remains its biggest profit generator. Products like Aashirvaad atta, Sunfeast biscuits, and Classmate notebooks make ITC a household name beyond cigarettes.
The Hospitality Angle
ITC Hotels is a luxury hospitality brand that’s been gaining traction. Its potential demerger (we’ll talk more about this) adds another layer of investor interest.
ITC Share Price Overview
Before this week’s turbulence, ITC had been enjoying a relatively steady ride. Over the last year, it showed resilience despite broader market fluctuations.
- 2022-2024 CAGR: Approx. 20%+ thanks to a strong FMCG push
- Volatility: Historically low, but recently spiked
The Unexpected Price Movement
So, what happened this week?
On Monday, ITC’s share price dipped over 4%, wiping out nearly ₹20,000 crores in market cap. Just a day later, it rebounded strongly, closing over 3% higher.
Such movement is rare for a stock like ITC, which traditionally shows stable and conservative behavior. That’s why everyone is asking the same question — why the sudden rollercoaster?
Key Reasons Behind the Sudden Shift
Corporate Announcements Stir the Pot
On Tuesday, ITC officially confirmed the timeline for ITC Hotels demerger — a move that’s been in the works for months. The buzz became real, and investors had to act fast.
Demerger Buzz – The Game Changer
Here’s the scoop:
- ITC plans to demerge its hotel business into a new entity named “ITC Hotels Limited.”
- Shareholders will get 1 share of ITC Hotels for every 10 shares of ITC they own.
- The move allows ITC to focus more sharply on FMCG and tobacco, while the new entity can pursue its hospitality ambitions.
Analysts believe this demerger could unlock hidden value, especially for long-term investors.
Q4 Earnings Impact
ITC’s Q4 FY25 earnings also came out this week. Here’s what stood out:
- Revenue: Slightly below expectations at ₹19,200 crore
- Net Profit: ₹5,020 crore (a 2.8% YoY increase)
- FMCG Segment: Grew by 7.3%
- Hotels Segment: Reported a massive 19% jump in EBIT
The numbers weren’t jaw-dropping, but the consistent growth—especially in the Hotels and FMCG verticals—kept investor confidence afloat.
FII and DII Actions
Foreign Institutional Investors (FIIs) started the week as net sellers, possibly reacting to broader macroeconomic cues and ITC’s earnings miss.
However, by midweek, Domestic Institutional Investors (DIIs) jumped in, likely seeing a buying opportunity after the price dip. This tug-of-war added fuel to the volatility.
Dividend Declaration
Adding to the buzz, ITC declared a final dividend of ₹7.50 per share, bringing the total dividend for FY25 to ₹13.50.
This generous payout kept long-term investors content and helped stabilize the stock after the initial drop.
Expert Opinions on the Movement
Market analysts offered mixed takes:
- Motilal Oswal: Maintains a Buy rating, target ₹515
- ICICI Securities: Cautiously optimistic, citing demerger benefits
- Kotak Institutional: Neutral stance but sees upside post demerger
Retail Investors’ Reaction
Social media platforms like Twitter (X), Reddit, and even YouTube saw a surge in ITC-related discussions. From memes about “ITC being the new Nifty’s rollercoaster” to serious threads about valuation unlocks — retail buzz was real.
Trading volumes on NSE surged by over 35% compared to the weekly average.
Technical Analysis
Let’s get a bit nerdy here:
- Support: ₹410
- Resistance: ₹445
- RSI: 57 (Neutral, but leaning bullish)
- MACD: Showing a bullish crossover
- 50-day MA: ₹428 (Stock trading close to it)
These indicators suggest short-term volatility with a positive bias.
Future Outlook for ITC
Short-Term
Expect continued volatility till the demerger goes through. Investor sentiment is closely tied to institutional actions and broader market mood.
Long-Term
If you’re in for the long haul, ITC still looks attractive:
- Steady dividend income
- Strong FMCG growth
- Valuation unlock from hotel demerger
- Low debt and high cash reserves
Should You Buy, Sell, or Hold ITC Now?
If you already own ITC — Hold. The dividend income and future hotel share make it worthwhile.
Looking to enter? Consider buying on dips, especially if it moves near ₹410 support levels. Long-term prospects are still strong, especially after the demerger.
Conclusion
This week’s movement in ITC’s share price wasn’t just noise — it was a reflection of deeper structural changes, investor sentiment shifts, and strategic corporate decisions. With a major demerger on the horizon, ITC is rewriting its legacy and charting a new course.
Investors should keep an eye out. The story’s just beginning.
FAQs
1. Why did ITC shares rise or fall this week?
Due to Q4 results, hotel demerger confirmation, dividend announcement, and FII-DII activity causing price swings.
2. Is ITC still a good long-term investment?
Yes, thanks to its strong FMCG growth, steady dividends, and upcoming hotel demerger.
3. What is the impact of the ITC Hotels demerger?
It could unlock hidden value and allow more focused growth in both businesses.
4. How often does ITC declare dividends?
Usually twice a year—interim and final—making it a favorite among dividend investors.
5. What are analysts predicting for ITC stock in the next quarter?
Cautious optimism with target prices between ₹470–₹515, depending on market conditions.
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