India focused: IPO, special situations, Stylus Holdings

Himanshu Dugar

India focused: IPO, special situations

Stylus Holdings

Stylus Holdings is a buy-side equity research firm. We offer bottom-up investment ideas as well as provide on demand equity research and portfolio tracking. 
At Stylus, our focus is to identify market dislocations that can generate 20+% IRR with a reasonable margin of safety. As part of our research process, we do a deep dive into the fundamentals of the company, evaluate their competitive positioning and assess their valuation.
Our investment team is led by Himanshu Dugar. Himanshu is a Chartered Accountant and a CFA charter holder. He has 10+ years of active experience in the stock market with stints at CRISIL Research, a S&P Global copmany and Miras Investments, a single family office based in Dubai.

Equity Research Firm

Equity Bottom-Up

<ul>
<li>ITC's share prices collapsed on 1st-Jan following a larger-than-expected indirect tax hike on Cigarettes in India. The changes translate to a 20-50% increase in MRP, potentially aiding illicit Cigarette trade.</li>
<li>We present data on how ITC's Cigarette business has performed well despite regular tax hikes and how steep hikes followed by a stable taxation envrionment benefits in the long term.</li>
<li>At CMP, stock is attractive at 20x Cigarette profits alone (peers trade at 25x), offering FMCG and agri business (worth 40/share) + 50k crores in cash/listed investments (40/share) as buffer.</li>
</ul>


ITC's share prices collapsed on 1st-Jan following a larger-than-expected indirect tax hike on Cigarettes in India. The changes translate to a 20-50% increase in MRP, potentially aiding illicit Cigarette trade.
We present data on how ITC's Cigarette business has performed well despite regular tax hikes and how steep hikes followed by a stable taxation envrionment benefits in the long term.
At CMP, stock is attractive at 20x Cigarette profits alone (peers trade at 25x), offering FMCG and agri business (worth 40/share) + 50k crores in cash/listed investments (40/share) as buffer.


ITC - Is It Time for Contrarian Investors to Enter?

External broker reports(aggregated public sources), Axis Direct

Axis Direct

External broker reports(aggregated public sources)

Axis Direct is the flagship brand under Axis Securities Limited, a subsidiary of Axis Bank in India. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

<ul><li>Business Vertical Performance: ITC reported a 6.2% YoY growth in revenue during Q3FY26, largely driven by double-digit revenue growth in FMCG-Others (+12.6%) and sustained momentum in the Cigarettes business (+8.2%).</li><li>Moreover, Agri Business’ revenue grew by 6.3% YoY, led by value-added Agri products and Leaf Tobacco.</li><li>In paperboards, paper &amp; packaging, revenue grew 2.7% YoY, with sequential profitability improved 19% QoQ and 11% YoY. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Business Vertical Performance: ITC reported a 6.2% YoY growth in revenue during Q3FY26, largely driven by double-digit revenue growth in FMCG-Others (+12.6%) and sustained momentum in the Cigarettes business (+8.2%).Moreover, Agri Business’ revenue grew by 6.3% YoY, led by value-added Agri products and Leaf Tobacco.In paperboards, paper &amp; packaging, revenue grew 2.7% YoY, with sequential profitability improved 19% QoQ and 11% YoY. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

ITC Ltd - FMCG Business Underpins Overall Growth; Maintain HOLD

Head of Research, Krungthai XSpring

Waraporn Wiboonkanarak

Head of Research

A full service Thai brokerage

Krungthai XSpring

Krungthai XSpring is a full service broker. The company provides a wide range of investment services such as Securities Brokerage, Derivative Agent Business, Securities Borrowing and Lending, Securities Trading, Underwriting, Financial Advisory, Wealth Advisory, Private Fund Management and International Markets Securities Trading. 

In terms of credibility, Fitch Ratings has assigned Krunghtai XSpring a long-term rating of AA- and a national short-term rating of F1+ with stable outlook.

<ul><li>KTX maintains a Neutral rating with a 2026E FV of Bt16.03, based on the earnings yield method using a required return of 7.4%, implying a target PER of 13.6x.</li><li>We expect ITC to report 4Q25E core profit of Bt790mn (–1% YoY, flat QoQ); including FX losses, net profit is estimated at Bt775mn (–2% YoY, –5% QoQ).</li><li>Our 4Q25E forecast implies downside risk to the 2025E outlook. However, we maintain our 2026E estimate, expecting net profit to recover to around Bt3.5bn, driven by revenue growth of about 7%, broadly in line with management’s target.</li></ul>

KTX maintains a Neutral rating with a 2026E FV of Bt16.03, based on the earnings yield method using a required return of 7.4%, implying a target PER of 13.6x.We expect ITC to report 4Q25E core profit of Bt790mn (–1% YoY, flat QoQ); including FX losses, net profit is estimated at Bt775mn (–2% YoY, –5% QoQ).Our 4Q25E forecast implies downside risk to the 2025E outlook. However, we maintain our 2026E estimate, expecting net profit to recover to around Bt3.5bn, driven by revenue growth of about 7%, broadly in line with management’s target.

I-Tail Corporation Plc. (ITC): 4Q25E Earnings Likely Flat To A Slight Lower - Neutral

<ul><li>India Cigarette Tax Overhaul: Near-Term Margin and Volume Headwinds: The Government of India has notified a new tobacco tax structure effective 1st February 2026, replacing the earlier 28% GST plus compensation cess regime with 40% GST and a higher excise duty, while NCCD remains unchanged.</li><li>While the exact impact under new tax structure is still evolving, the higher levy is likely to force companies such as ITC and their peers to raise prices, which could dampen sales volumes in near term, leading to potential demand softness.</li><li>On the other hand, if the price hikes are delayed, companies could face pressure on operating margins.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

India Cigarette Tax Overhaul: Near-Term Margin and Volume Headwinds: The Government of India has notified a new tobacco tax structure effective 1st February 2026, replacing the earlier 28% GST plus compensation cess regime with 40% GST and a higher excise duty, while NCCD remains unchanged.While the exact impact under new tax structure is still evolving, the higher levy is likely to force companies such as ITC and their peers to raise prices, which could dampen sales volumes in near term, leading to potential demand softness.On the other hand, if the price hikes are delayed, companies could face pressure on operating margins.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

ITC Ltd - Near Term Tax Hike Challenges; Rating Revised to HOLD

India Equity Analyst - Fundamental & Thematic, Beat the Street

Sudarshan Bhandari

India Equity Analyst - Fundamental & Thematic

Beat the Street

Beat The Street was founded by Nimish Maheshwari and Sudarshan Bhandari, both of whom are Chartered Accountants by Profession, known for their expert analysis in the fields of Business, Sectoral analysis, and Corporate governance.

With a strong social media presence of 45,000+ Subscribers across various platforms, they are considered trusted voices in the industry. Their insights and analysis have been featured in some of India’s most prominent publications, including the Economic Times, Dalal Street Investment Journal, The Morning Context, and The Ken.

Their analysis on Bankrupt & Insolvent companies has been instrumental in saving investors from significant losses. They have a keen eye for identifying red flags and has identified exclusive redflags earlier in Vedanta, Nykaa, Dhani Services, Adani and many more.

Read Business Not Stock Prices

<ul>
<li>India notified a new and increased excise duty on cigarettes, effective Feb 1, 2026, alongside a 40% GST regime.</li>
<li>On January 1, 2026, tobacco stocks sold off sharply. ITC fell about 9%, Godfrey Phillips India around 15–17%, and VST Industries about 4%.</li>
<li>Total tax per cigarette rises more than expected, raising risks to volumes and accelerating illicit trade.</li>
</ul>


India notified a new and increased excise duty on cigarettes, effective Feb 1, 2026, alongside a 40% GST regime.
On January 1, 2026, tobacco stocks sold off sharply. ITC fell about 9%, Godfrey Phillips India around 15–17%, and VST Industries about 4%.
Total tax per cigarette rises more than expected, raising risks to volumes and accelerating illicit trade.


ITC: Tobacco Volumes to Be Impacted by Increased Taxes; Uncertainty Ahead

India

ITC Limited, a member of BAT Group of UK, is a holding company, which has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri Business, Packaged Foods & Confectionery, Branded Apparel, Greeting Cards and other FMCG products.

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ITC Ltd (ITC IN)

ITC - Is It Time for Contrarian Investors to Enter?

ITC's share prices plummeted after a significant tax hike on cigarettes in Jan. Historically, business has been resilient despite hikes + we feel...

Himanshu Dugar

ITC Ltd - FMCG Business Underpins Overall Growth; Maintain HOLD

ITC reported a 6.2% YoY growth in revenue during Q3FY26, largely driven by double-digit revenue growth in FMCG-Others (+12.6%)

Axis Direct

I-Tail Corporation Plc. (ITC): 4Q25E Earnings Likely Flat To A Slight Lower - Neutral

KTX maintains a Neutral rating with a 2026E FV of Bt16.03, based on the earnings yield method using a required return of 7.4%, implying a target...

Krungthai XSpring

ITC Ltd - Near Term Tax Hike Challenges; Rating Revised to HOLD

he Government of India has notified a new tobacco tax structure effective 1st February 2026, replacing the earlier 28% GST plus compensation cess...

Axis Direct

ITC: Tobacco Volumes to Be Impacted by Increased Taxes; Uncertainty Ahead

India raises excise duty on cigarettes, causing tobacco stocks to plummet and raising concerns about increased illicit trade due to higher taxes.

Sudarshan Bhandari

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52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

ITC - Is It Time for Contrarian Investors to Enter?

​ITC's share prices plummeted after a significant tax hike on cigarettes in Jan. Historically, business has been resilient despite hikes + we feel...

Himanshu Dugar

ITC Ltd - FMCG Business Underpins Overall Growth; Maintain HOLD

ITC reported a 6.2% YoY growth in revenue during Q3FY26, largely driven by double-digit revenue growth in FMCG-Others (+12.6%)

Axis Direct

I-Tail Corporation Plc. (ITC): 4Q25E Earnings Likely Flat To A Slight Lower - Neutral

KTX maintains a Neutral rating with a 2026E FV of Bt16.03, based on the earnings yield method using a required return of 7.4%, implying a target...

Krungthai XSpring

ITC Ltd - Near Term Tax Hike Challenges; Rating Revised to HOLD

he Government of India has notified a new tobacco tax structure effective 1st February 2026, replacing the earlier 28% GST plus compensation cess...

Axis Direct

ITC: Tobacco Volumes to Be Impacted by Increased Taxes; Uncertainty Ahead

​India raises excise duty on cigarettes, causing tobacco stocks to plummet and raising concerns about increased illicit trade due to higher taxes.

Sudarshan Bhandari

ITC's share prices plummeted after a significant tax hike on cigarettes in Jan. Historically, business has been resilient despite hikes + we feel...

India raises excise duty on cigarettes, causing tobacco stocks to plummet and raising concerns about increased illicit trade due to higher taxes.