ITC stock puffed up over stable tax regime, steady volume recovery

Better capital allocation and valuation make it a preferred choice amid a volatile environment

ITC, the country’s largest cigarette maker, has been a major outperformer since March on the returns front, besting its peer index BSE Fast Moving Cons­umer Goods and the benchmark Sensex.

While the consumer major delivered returns of 36 per cent, its peer index trail­ed with 16 per cent gains; the Sensex pos­ted losses of 4.4 per cent during the period under review. These gains were led by smart recovery across its key verticals over the past couple of quarters, an improved outlook for cigarettes — which remains the cash cow — and easing concerns related to the environmental, social and corporate