ITC stock is on the rise, the company is also giving dividend, know whether there will be a rise in the future as well?:

News Topical, Digital Desk : The Indian stock market witnessed a strong rally on 23 May 2025, in which the stock of ITC Limited performed brilliantly. The company's share prices are continuously increasing, behind which there are many important reasons, such as excellent quarterly results, dividend announcement and acquisition of new companies. Let us know in detail whether this momentum of ITC's stock can continue in the future as well.

Strong quarterly results raised investors' expectations

ITC presented the results of the March 2025 quarter, in which the company's total income registered a growth of 10 percent. The company's revenue stood at Rs 203.7 billion, which is much better than the previous year. Apart from this, ITC's different businesses, such as agri-business, cigarettes and FMCG (fast-moving consumer goods) sector have performed well.

However, the company's net profit stood at Rs 198 billion, which included a one-time gain of Rs 151.8 billion (received from the demerger of the hotel business). If this one-time gain is removed, ITC's core profit stood at Rs 46.6 billion, which was in line with market expectations.

The announcement of dividend boosted the confidence of investors

ITC has announced an interim dividend of Rs 7.85 per share to its shareholders. Earlier, a dividend of Rs 6.50 per share was also given in February 2025. In this way, a total dividend of Rs 14.35 per share will be given in the financial year 2024-25.

Based on the current share price (Rs 436.30), this dividend yield is around 3.3 per cent, which is higher than many bank fixed deposits (FD). This is the reason why investors are increasingly turning to ITC shares.

New acquisitions boost growth prospects

ITC has recently acquired several new companies, which has expanded its business. These include 24 Mantra Organic, Mother Sparsh and Prasuma (Meetigo). Apart from this, the company has also made a big deal in the paper and packaging sector. All these steps can prove to be helpful in creating new revenue streams for ITC.

There are challenges too

Although ITC's performance has been good, there are some challenges. Pressure of government regulations on cigarette business - The government's continuous increase in taxes on tobacco products and strict regulations may affect this segment of ITC.

There is also competition in the FMCG sector. With increasing competition from HUL, Nestle and other companies, ITC will have to focus more on marketing and innovation of its products. Analysts believe that ITC's stock may rise further, as ITC shareholders may get additional benefits after the demerger of the hotel business into a separate company. Growth prospects in FMCG and agri-business are strong. Dividend yield is still attractive, which can provide returns to long-term investors.