ITC declines after govt divests part stake

ITC dropped 0.98% to Rs 278.45 at 10:10 IST on BSE after the government divested a part of its stake in the company to Life Insurance Corporation of India.

It was stated by Arjun Ram Meghwal, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha on Friday, 24 March 2017.

Meanwhile, the S&P BSE Sensex was down 159.71 points, or 0.54% to 29,261.69.

On the BSE, 45,097 shares were traded on the counter so far as against the average daily volumes of 11.98 lakh shares in the past one quarter. The stock had hit a high of Rs 281.20 and a low of Rs 276.40 so far during the day.

The stock had hit a record high of Rs 291.95 on 7 February 2017 and a 52-week low of Rs 204 on 6 May 2016. The stock had outperformed the market over the past one month till 24 March 2017, rising 5.78% compared with the 1.83% rise in the Sensex. The scrip had also outperformed the market in past one quarter, rising 25.02% as against Sensex's 12.98% gains.

The large-cap company has equity capital of Rs 1214.74 crore. Face value per share is Re 1.

Government through specified undertaking of the Unit Trust of India (SUUTI) has divested 2% shares of the total shares of ITC to LIC through block trade on 7 March 2017. Government has received an amount of Rs 6682 crore from this transaction.

Disinvestment of Government of India equity is under taken as per the disinvestment policy of the GoI keeping in view the resource requirement of the Government and the prevailing market conditions. SUUTI had held 11.1% stake and LIC of India held 14.29% in ITC as on 31 December 2016, as per the shareholding pattern of the company.

ITC's net profit rose 5.7% to Rs 2646.73 crore on 4.1% increase in net sales to Rs 9149.31 crore in Q3 December 2016 over Q3 December 2015.

ITC is a diversified company, with presence in cigarettes, hotels, paperboards & specialty papers, packaging, agri-business, packaged foods & confectionery, information technology, branded apparel, personal care, stationery and other FMCG products. ITC is a market leader in cigarettes.

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