Street View: ITC faces volume, margin pressure as cigarette tax hike clouds outlook

ITC

22/05/2026 05:40

** India's ITC ITC.NS posted marginal rise in quarterly adjusted profit, helped by cigarette price hikes that somewhat offset tax and cost pressures

** Shares fall over 1.5% to 303.30 rupees

PRICE HIKES WEIGH ON VOLUMES

** Jefferies ("Hold," PT: 350 rupees) says the "real test" lies in June quarter as the full impact of higher taxes and partial price hikes could hurt volumes, profitability

** Elara ("Accumulate," PT: 335 rupees) says Q4 does not reflect the true volume impact due to tax changes, with Q1FY27 expected to provide clarity on the effect of price hikes

** Macquarie ("Neutral," PT: 330 rupees) sees a sharp hit to profitability in the June quarter before gradual improvement

** Nomura ("Reduce," PT: 300 rupees) says staggered price hikes may not fully offset the tax burden, keeping margins under pressure in the near term

 (Reporting by Bipasha Dey in Bengaluru)

 ((Bipasha.Dey@thomsonreuters.com;))