Discussion in 'Ask A Query About Your Stock Picks And Portfolio' started by Sandeep Gupta, Jan 26, 2016.
whats the outlook for ITC
Smoky. Burdened by sin tax. Love the business but no money for ITC.
Wait for the budget. Cigarettes business is a cash cow for ITC, which will be slaughtered by taxes. But I've not seen a smoker complain about taxes.
Revenue from tobacco business ~ 48%, contribution to pre tax profits ~ 74%! Once the investment in FMCG business starts yielding returns on the capital employed, it'll look better.
Smoker complain but have no choice because of addiction. Same with liqour stocks.
The price conscious, maybe. The demand is price inelastic.
We always have and make choices.
I chose to reply. Not encouraging smoking. Not complaining unless you're blowing smoke in my face.
"I can control my destiny, but not my fate. Destiny means there are opportunities to turn right or left, but fate is a one-way street. I believe we all have the choice as to whether we fulfil our destiny, but our fate is sealed."
So v can expect ITC going down further as budget is fast approaching
I can't comment on price levels. It's held post results, been in a narrow range over 6 months and traded at yearly high on 28 Feb, 2015 - ₹409
I'll buy post budget when there's certainty over taxes even if it means paying a premium over current rates.
Exact Logic for investment since decades.
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