GQG Sells ITC Shares in ₹9,395 Crore Block Deal Following 30% Annual Decline.

In a significant block deal, GQG Partners Emerging Markets Equity Fund divested approximately Rs 9,395 crore worth of ITC shares at a price of Rs 257.35 per share. This transaction occurred amidst notable buying interest from key institutional investors, including Fidelity, ICICI Prudential Mutual Fund, and SBI Mutual Fund, who collectively acquired a substantial portion of the sold shares. Specifically, Fidelity Advisor Overseas Fund emerged as the largest buyer, securing 13.4 crore shares for about Rs 3,448 crore. Other notable investors participated substantially, with ICICI Prudential Mutual Fund and SBI Mutual Fund investing around Rs 2,419 crore and Rs 968 crore, respectively. The total value of the block deal approximately reached Rs 9,437 crore, indicating a robust demand for ITC amid ongoing selling pressure.

Despite the significant buying interest, ITC’s stock culture reflects underlying challenges, having dipped nearly 30% year-to-date. Factors contributing to this decline include heightened concerns regarding cigarette taxation, a slow recovery in volume, and a tepid appetite from investors for defensive consumer stocks. Analysts maintain diverging views on ITC’s near-term prospects. HDFC Securities has reiterated an “Add” rating, projecting a target price of Rs 300 based on a sum-of-the-parts analysis which assesses the cigarette segment at Rs 137 per share, while the broader FMCG portfolio is valued at Rs 98 per share. Furthermore, it is noteworthy that ITC has opted for a gradual approach in implementing price increases post-tax hikes, which could stabilize revenue streams moving forward.

Moreover, analysts are optimistic about ITC’s hotel segment, which has been restructured as ITC Hotels. Jefferies highlights the positive trajectory in the hospitality sector, fueled by domestic travel demand, weddings, and a gradual rebound in corporate travel. The management’s strategic shift towards an asset-light model—aiming for a portfolio mix of one-third owned and two-thirds managed hotels—could enhance operational flexibility and profitability. This transition is expected to require lower capital investment, yielding a higher margin and improved returns on capital over time. Overall, these developments suggest resilience in certain segments of ITC’s business despite prevailing market headwinds.

Source: The Economic Times

(Expert Note: This intelligence brief was structured and verified by the Wealthova editorial desk.)