ITC share price hits 52-week low as 2026 taxes bite

What happened to ITC share price

ITC Ltd shares traded under pressure and hit fresh 52-week lows during intra-day trade, as investors reacted to concerns around earnings in the company’s cigarette business. The stock moved down 2.64 percent from its previous close of Rs 283.25, with the last traded price cited at Rs 275.80. In Wednesday’s session, ITC slipped as much as 3 percent on the BSE and touched a fresh 52-week low of Rs 274.45.

The move extended a broader downtrend that has pushed the stock to levels last seen in September 2022, according to the report referencing the period before the demerger of the hotel business. ITC has also been described as hitting a fresh 52-week low for multiple consecutive sessions as selling pressure persisted.

A four-session run of fresh 52-week lows

The selling has been described as a slow correction that accelerated once ITC slipped below the Rs 300 mark on May 27. After that, the stock recorded four fresh 52-week lows across successive sessions: Rs 286, Rs 278.40, Rs 277 and Rs 272.25 on May 29, June 1, June 2 and June 3, respectively. During the current streak, ITC also fell below a prior 52-week low of around Rs 287 that had been hit on March 30.

In another cited data point from the same downcycle, ITC shares fell 1.66 percent to a low of Rs 275.25, with the market capitalisation reported at Rs 3.48 lakh crore.

Underperformance versus the Sensex in 2026

The decline has stood out against the broader market. Thus far in calendar year 2026, ITC has plunged 32 percent, underperforming the BSE Sensex, which fell 13.4 percent over the same period. At 10:19 AM in one of the referenced sessions, ITC was trading 2.2 percent lower at Rs 276.90, compared with a 1.2 percent decline in the BSE Sensex.

This relative underperformance has kept attention on policy and earnings sensitivity in ITC’s cigarette segment, which remains a key driver for profitability even as the company has expanded its FMCG portfolio.

Tax changes driving cigarette earnings concerns

A central overhang flagged by analysts is the revised taxation framework for cigarettes. The report estimates this has resulted in a 60-65 percent surge in cigarette taxes for ITC. Based on the historical mix referenced, this implies the need for around a 35 percent hike in maximum retail prices (MRPs).

Such increases raise the risk of volume pressure and slower growth in the near term, even if price hikes offer partial cushioning. The market reaction suggests investors are weighing how quickly price actions can be implemented and how demand holds up after the tax increase.

Technical picture: key levels traders are watching

Multiple technical analysts have pointed to a bearish setup. The stock has been described as trading below its key short-term and long-term moving averages, reinforcing negative sentiment.

Jigar S Patel of Anand Rathi highlighted support at Rs 280 and resistance at Rs 310, adding that a decisive breakout above Rs 310 could open the door for a move towards Rs 330. For the short term, he expects trading within a Rs 280 to Rs 330 range.

Choice Broking’s Hitesh Tailor said ITC was trading below key 20, 50, 100 and 200-week EMA levels, indicating a negative medium to long-term trend structure. He flagged the Rs 300-305 zone as a resistance area and said further weakness could pull the stock towards the Rs 270-260 zone.

Q4 FY26 and recent quarter reactions

In another market reaction window, ITC shares fell over 1 percent on May 22 even after the company reported a marginal rise in quarterly adjusted profit. The report said price increases in the core cigarette business cushioned some of the impact from a tax hike and an Iran-war-led rise in raw material costs. At 12:05 pm on May 22, ITC was trading 1.2 percent lower at Rs 304.2.

Separately, following the March 2026 quarter (Q4 FY26) results, brokerages largely maintained cautious to neutral views. One report noted that at Rs 302.65, ITC had corrected 25.01 percent over the past six months.

Brokerage views: mostly cautious, targets vary

Brokerage stances in the cited coverage ranged from Sell to Outperform, with many remaining on the sidelines due to policy risk on cigarette taxes.

Analysts in one note maintained a Neutral rating with a sum-of-the-parts (SoTP) target price of Rs 300, based on 18x Mar’28E EPS. Another note maintained a Neutral rating with an SoTP-based target price of INR 335, implying 20x FY28E EPS.

Global brokerages also differed: Jefferies had a Hold with a target of Rs 350, Citi had a Sell with a target of Rs 290, and CLSA had an Outperform with a target of Rs 390. Morgan Stanley maintained an Equal Weight rating with a target of Rs 366, while Motilal Oswal reiterated a Neutral rating with a target of Rs 365.

Key data points at a glance

Brokerage targets and ratings mentioned

Market impact: what investors are reacting to

The price action shows that policy risk is currently dominating the narrative. Even when quarterly performance is described as largely in line, higher cigarette taxes from February 1 have “capped optimism” in brokerage commentary, keeping expectations restrained.

The market is also responding to technical damage after the stock broke below the Rs 300 support zone, which had earlier been described as a major demand area. With the stock printing repeated 52-week lows, short-term sentiment remains cautious until it stabilises above identified resistance levels.

Why this matters for ITC and the FMCG space

ITC’s move highlights how sensitive consumer staples valuations can be to regulatory changes when a significant part of profitability is linked to a heavily taxed category. The estimate of a 60-65 percent tax surge and the implied need for roughly 35 percent MRP increases underscores the magnitude of the adjustment being priced in.

Brokerage reactions, taken together, suggest that investors see valuation comfort in parts of the business and resilience in FMCG operations, but limited visibility on near-term upside while cigarette taxation remains the key swing factor.

Conclusion

ITC shares have extended a sharp 2026 decline, hitting fresh 52-week lows as the market focuses on the earnings implications of higher cigarette taxes and a weakened technical setup below Rs 300. Investors will track how price hikes and operating performance evolve under the revised tax framework, along with any further brokerage updates and support-resistance behaviour around the Rs 280 and Rs 300-310 zones.