FPIs led by GQG Partners puff up ITC stock, raise holding in March quarter

GQG Partners, which last month bought Rs 15,000 crore worth Adani Group stocks, also increased its bet on cigarette-to-hotels conglomerate ITC.

As of March end, the US investment firm’s stake in ITC was 1.44% — up from 1.29% at the end of December quarter — data on the BSE revealed.

Foreign portfolio investors (FPIs) increased their ownership in the company in the last quarter. The cumulative holding of category-I FPIs was 12.87% at the end of March quarter, up from 12.51% a quarter ago.

Meanwhile, sequentially, insurance companies’ total holding in the March quarter dropped marginally. Insurance majors, including Life Insurance Corporation of India, cumulatively held 20.40% stake at the end of March quarter, against 20.44% a quarter ago.

LIC reduced its holding marginally by selling over 5,00,000 shares of the conglomerate.

ITC is the second best performing stock on Nifty 50 year-to-date. The stock has given more than 20% returns so far in 2023, whereas Nifty 50 has given over 2% negative returns.

ITC stock also scaled a lifetime high of Rs 402 on Monday. Infact, in over 3 years, the stock has turned a multibagger. In the March quarter alone, the stock gained about 16%.

Even after such a strong run, analysts have retained their bullish stance on the stock.

“We have a strong buy on ITC. Last year, ITC was among the best performing stocks, and we expect that to recur this year also,” said Abneesh Roy, executive director, Nuvama Institutional Equities.

In the brokerage’s model consumer portfolio, ITC enjoys a 30% weightage, which is the highest along with Godrej Consumer.

The bullish view on ITC also comes from the earnings growth prospects. In the March quarter too, Roy expects ITC to report double-digit volume growth in cigarettes.

Pankaj Pandey of ICICI Securities is equally bullish on ITC and has a price target of Rs 450 for the stock. This implies an upside potential of 13% from the current levels.

“I think high value or high P/E multiple names are not really facing the kind of buying largely because there are a lot of fear in terms of entry of new players…So, ITC, I think from that perspective, is relatively better off with valuation being the biggest in their favour,” Pandey said.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)