ITC shares surge in a weak market, trade near 52-weak high

Earlier this month, the cigarette-to-hotel conglomerate announced plans to acquire D2C health food brand Yoga Bar, a health snack company based in Bengaluru. The FMCG major will acquire 100% of Sproutlife Foods Private Limited (SFPL) over a period of three to four years.

It will initially acquire a 47.5% stake in SFPL in tranches, by March 31, 2025 and the balance stake will be acquired, basis pre-defined valuation criteria, subject to other conditions agreed to in the binding documents. The purchase of the balance 52.5% shares taking the shareholding to 100 per cent would be determined based on pre-agreed valuation criteria and subject to fulfilment of various terms and conditions, it added.

The acquisition will enable ITC to augment its future-ready portfolio and enhance market presence in the ‘good for you’ space which currently includes Aashirvaad Multi-Grain Atta, Aashirvaad Nature’s Super Foods, Farmlite range of biscuits, Sunfeast Protein Shake, B Natural Nutrilite ABC Beverage, among others.

Established in 1910, ITC Limited is a diversified conglomerate with businesses spanning Fast Moving Consumer Goods comprising Foods, Personal Care, Cigarettes and Cigars, Education & Stationery Products, Incense Sticks and Safety Matches; Hotels, Paperboards and Packaging, Agri Business and Information Technology. ITC shares are up over 4% in a month, whereas the fast-moving consumer goods (FMCG) stock has gained more than 61% in a year’s period.

Diversified conglomerate ITC Ltd reported a nearly 21% rise in net profit for the quarter ending September 2022 to ₹4,466 crore, helped by the cigarettes, agri and its hotels businesses. The company is yet to announce its earnings for the third quarter ended December 2022.