ITC Ltd (NSE: ITC) is an Indian multinational conglomerate company headquartered in Kolkata, West Bengal. ITC has a diversified presence across industries such as cigarettes, FMCG, hotels, packaging, paperboards & specialty papers, and agribusiness. The company completed 100 years in 2010 and had an annual turnover of $10.74 billion as of 2019–20, and a market capitalization of $35 billion. It employs over 36,500 people at more than 60 locations across India and is part of the Forbes-2000 list. On July 27, 2020, ITC acquired 100 per cent of the equity share capital of Sunrise Foods in a Rs2,150-crore deal. Consequent to it, Sunrise and its two subsidiaries, Sunrise Sheetgrah Private Ltd and Hobbits International Foods Pvt Ltd, have become wholly-owned subsidiaries of ITC. Sunrise is a market leader in eastern India in the fast-growing spices category and has a brand legacy of over 70 years.
On the technical front, ITC has higher highs and higher lows on the daily charts and is currently placed above the long-term EMAs in the daily frame. In the recent past, after clocking a low of Rs196 level, the stock has witnessed a bounce and rallied to the current levels. At the current juncture, the stock has formed a base of around Rs202-203 levels on the lower side and is all set to move higher. The overall chart structure of the counter looks bullish from current levels and is witnessing a bounce from the support zone around Rs191 level. This may trigger a fresh round of buying, which may take the stock towards Rs240 plus levels. The stock is currently performing in line with the broader markets indicating the inherent strength in the counter and is trading well above the major long-term support levels. On the Bollinger band (20,2), the stock price is trading above the mean with the upper band facing in the northward direction indicating the price likely to move higher. Analyzing the recent volume price action, the volumes have been encouraging in the recent up move indicating strong hands have started accumulating the stock at current levels. On the oscillator’s side, RSI (14) is trading in a comfortable zone of above 60 levels indicating the intact bullishness in the stock. We expect the counter to continue its outperformance in the coming trading days as well and may move towards Rs250 level in the medium-term. Any correction towards the recent support levels of Rs202-203 levels may be utilized to average the positions.
Srinivas Krishnan Bobba, Deputy Manager (technical research analysis) Karvy Stockbroking Ltd