On Monday, ITC, Asia’s largest cigarette manufacturer, briefly regained its position as India’s most valuable fast-moving consumer goods (FMCG) stock, displacing Hindustan Unilever (HUL) from the top spot.
The conglomerate, primarily known for its cigarette sales but also involved in hotels, paper, and consumer staples industries, witnessed its valuation surge above ₹6.1 trillion ($74 billion) for the first time in history during the session. This surpassed Hindustan Unilever’s ₹6.09 trillion for a while. However, the stock closed 3.9% lower, followed by the company’s announcement to demerge its hotel business, retaining a 40% shareholding in the new entity. Thus, it settled at ₹5.9 trillion.
Over the last 12 months, ITC’s astonishing rally, made it outperform all other Nifty 50 stocks with a growth of more than 60%.
While HUL is still grappling with sluggish rural Indian sales recovery after the pandemic, ITC’s diverse business interests have contributed to a substantial 30% increase in its earnings per share for the year ending in March. This made investors to prefer ITC over HUL.
According to some experts, ITC is expected to outperform HUL in the near future, largely due to its relatively stable cigarette business with no significant roadblocks.