ITC Share Price Rises 1.33% as GST Reforms Bring Fresh Policy Clarity

Overview

• ITC share price today rose 1.33% to ₹417.20 amid GST reforms simplifying tax structures.

• Analysts remain bullish on ITC stock with 64% ‘Buy’ ratings and a 3.44% dividend yield.

• New 40% GST slab for tobacco reduces policy uncertainty, aiding ITC’s long-term outlook.

ITC shares traded higher on September 4, 2025 as investors cheered the government’s sweeping overhaul of the Goods and Services Tax (GST). The move simplifies the tax structure into two primary slabs. It also introduced a separate high-tax category for sin goods such as tobacco, offering greater policy clarity for companies like ITC.

ITC share price today was quoted at ₹417.20 on the NSE at press time, up 1.33% or ₹5.45 from the previous session. The stock opened at ₹423.95 and touched an intraday high of ₹427.00, before easing slightly. Its 52-week range stands between ₹390.15 and ₹528.50, with the all-time high at ₹528.50. The current market capitalization is around ₹5.20 lakh crore, making ITC one of India’s largest listed companies.

Trading and Valuation Metrics

ITC stock volume stood at over 21.4 million shares with a traded value of nearly ₹8,956 crore. The 20-day average volume is 14.1 million, with a healthy average delivery percentage of 71.35%. The stock’s Beta of 0.62 indicates relatively lower volatility compared to the broader market.

ITC share price chart on TradingView shows gains of 1.20% during intraday trade:

On the fundamentals side, ITC shares have a trailing twelve-month earnings per share (EPS) of ₹27.86, which represents a strong 70% year-on-year growth. The stock trades at a price-to-earnings (P/E) ratio of 14.98, broadly in line with the sector average of 14.66. Its price-to-book (P/B) ratio is 6.95, while the dividend yield stands at an attractive 3.44%. Thus, reinforcing ITC’s appeal as a defensive stock with consistent cash flows.

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GST Reform Impact

The GST Council’s 56th meeting approved a major restructuring, cutting the existing four slabs of 5%, 12%, 18%, and 28% into just two rates of 5% and 18%. Additionally, a new 40% slab has been created for luxury goods, tobacco, and related products.

Finance Minister Nirmala Sitharaman clarified that tobacco will, for now, continue to attract the current levy of 28% plus a compensation cess. This will remain in place until outstanding loans taken to cover states’ revenue shortfalls are repaid. Once that obligation is cleared, tobacco products will move to the new 40% GST slab.

Brokerages believe this move reduces uncertainty around taxation for ITC. Analysts at Jefferies noted that while the immediate benefits depend on the timeline for implementation, the clarity in policy could help ITC plan better for the long term.

Analyst Sentiment

Analyst recommendations remain mostly positive on ITC share price. Based on 36 broker reports, 64% rate the stock a ‘Buy,’ 31% suggest ‘Outperform,’ while only a small fraction recommend ’Hold’ or ‘Sell.’ The consensus view is that ITC’s defensive business model, steady dividend payouts, and strong earnings momentum make it a reliable pick in uncertain markets.

Market Outlook

GST reforms are expected to stimulate broader consumption as the company’s tobacco segment gains clarity on tax treatment. ITC stock looks well-positioned to sustain investor interest. The attractive dividend yield and relatively low P/E further strengthen its case for long-term investors. While regulatory risks remain, the latest tax overhaul appears to have shifted sentiment in ITC shares’ favor.

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FAQs

1. Why did ITC share price rise after the GST reforms?

ITC share price gained 1.33% because the GST Council introduced a simplified tax structure and a dedicated 40% slab for tobacco products. This provided greater clarity on long-term taxation and reduced uncertainty for ITC investors.

2. How are ITC’s financial fundamentals shaping investor sentiment?

Investors view ITC positively due to strong fundamentals. Its EPS grew 70% year-on-year, the stock trades at a fair P/E of 14.98, and it offers a stable 3.44% dividend yield, making it attractive for defensive portfolios.

3. What role does ITC’s dividend yield play in its stock appeal?

ITC’s dividend yield of 3.44% provides consistent income to shareholders, boosting its appeal as a defensive stock. This yield, combined with steady earnings, makes ITC attractive for both growth and income investors.

4. How do analysts currently rate ITC stock?

Analyst sentiment is largely bullish. Out of 36 analysts, 64% recommend a ‘Buy’ and 31% suggest ‘Outperform.’ This consensus reflects confidence in ITC’s strong fundamentals and clarity on tax policies post-GST reforms.

5. What risks could still impact ITC’s performance despite GST clarity?

While GST reforms reduced tax uncertainty, risks remain. These include potential changes in government policy, regulatory challenges in the tobacco sector, and market volatility that could impact ITC’s future growth trajectory.