0710 GMT - The tax increases announced in India's latest budget are unlikely to have a negative impact on ITC, and in fact, seem to be clearing the regulatory outlook for the tobacco company, says Citi analyst Vismaya Agarwal in a note. The 2.0% tax hike on cigarettes is fairly modest, given that the last one happened in February 2020, and shouldn't dent sales volumes for ITC, which will likely offset the increase by boosting product prices, he says. Citi thinks that the tax hike could also have the effect of pricing other competitors out of the market and curbing sales of illegal cigarettes, which would also benefit ITC's sales. The U.S. investment bank keeps a buy rating on the stock and raises the target price to INR415 from INR390. Shares rise 5.3% to INR380.75. (yiwei.wong@wsj.com)

(END) Dow Jones Newswires

February 02, 2023 02:10 ET (07:10 GMT)

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