ITC 7th firm to cross Rs 6 trillion in market cap ITC on Thursday became the seventh company to cross Rs 6 trillion in market value. The scrip gained 2.8% to close at Rs 492.15, after touching a fresh high of Rs 493.50. The stock has given returns of 48.4% on a year-to-date basis, with market cap rising Rs 2.01 trillion since then. It has gained 65% in the last one year, and more than 155% in the last three. It attributes the same to multiple factors, the first being strong volume growth in cigarettes led by market share gains and new product launches. A ramp-up in outlet coverage, effective implementation of the localisation strategy, premiumisation, leveraging of technology on demand and supply side, and moderating raw material input costs — have led to improving Ebit margins. Further, the hotels business has seen an uptick with travel, wedding, and corporate activities reviving (possible demerger of hotels will only boost profitability). Finally, the steady performance in paperboard and agribusiness in FY23 has also strengthened fundamentals. ITC’s journey from the Rs 3 trillion to Rs 4 trillion m-cap mark took three years, while that from Rs 4 trillion to Rs 5 trillion took six years. However, it took just three months to scale the journey to Rs 6 trillion. RIL, TCS, HDFC Bank, ICICI Bank, HUL, and Infosys are the only other companies to have crossed Rs 6 trillion in market value. “HUL’s market cap is now just 4% higher than ITC. We expect ITC to soon edge ahead. Having gone up more than 50% in 1 year, ITC remains a ‘buy’. Value unlocking in the hotels business has been one of the drivers, apart from decent growth in cigarettes, FMCG, and hotels. The rational tax policy for cigarettes has also been a boon for ITC,” said Abneesh Roy, executive director, Nuvama Institutional Equities.
The launched works involve rehabilitating the Galgamuwa Railway Station and upgrading the railway line from Maho to Anuradhapura, including additional tasks. Another project is the second phase of track rehabilitation from Maho to Omanthai (128 kms), funded by a $318 million Indian Line of Credit.
Transport Minister Gunawardena praised the efforts of Indian company IRCON in Sri Lanka and called for more cooperation in the railway sector. State Minister Shantha Bandara and officials from the Sri Lankan Ministry of Transport attended the event.
Railways is a priority for Indian assistance in Sri Lanka, with over $1 billion invested under five Indian Lines of Credit. IRCON has been involved in Sri Lanks since 2009. It has contributed to the modernisation of Sri Lanka Railways by reconstructing the entire railway line network in the Northern Province (253 Km) and upgradation of the Southern line (115 km), as well as improving safety through advanced signalling and telecommunication systems.
Despite Sri Lanka’s debt standstill in April 2022, India’s support under various Lines of Credit has continued.
(With PTI inputs)