ITC surges for third day in a row ahead of Q3 results
FMCG giant and cigarette manufacturer ITC gave a slightly southward-titled horizontal trendline breakout at Rs 273 level today. It is the third consecutive uptick for the stock, where it opened with a gap-up, corrected up to the trendline level and bounced back to trade above the Rs 273-mark. The breakout was supported by rising volumes and the 14-period RSI quoting at 64 level. All-in-all, the stock remained volatile throughout, ahead of Q3 results.
ITC posted robust net profit growth of 17 per cent YoY and 16.8 per cent QoQ despite revenue de-growth. The bottomline growth was driven by operational efficiency. The cigarette segment contributed nearly 43 per cent to the total revenue of the company in Q3. The cigarette revenue, however, declined by 44 per cent QoQ.
Coming back to the technicals, the stock witnessed gradual lower tops and lower bottoms after a gap-down opening on July 18. The stock has been gradually recovering from its double bottom at Rs 250 level. This week, the stock breached its multi-month major resistance at Rs 276 level, making a kind of rounding bottom breakout with rising volumes on the weekly time frame.
Going forward, we may see a potential upside in the stock above Rs 276 level, say, an upside of Rs 25-30 in the first place.