Trading Volume and Price Action Overview
On the first trading day of 2026, ITC Ltd. recorded a staggering total traded volume of 6.00 crore shares, translating to a traded value of approximately ₹2,380.5 crores. This volume surge places ITC among the most actively traded equities on the bourses, underscoring heightened investor interest despite the stock’s downward trajectory. The stock opened at ₹402.7, touched an intraday high of ₹402.7, but succumbed to selling pressure to hit a low of ₹384.25 before settling near the day’s low at ₹385.3.
The closing price represents a sharp 4.39% loss for the day, marginally outperforming the Cigarettes/Tobacco sector’s decline of 4.71%. The broader Sensex, in contrast, managed a modest gain of 0.15%, highlighting the sector-specific headwinds impacting ITC.
Technical and Market Sentiment Indicators
ITC’s technical setup remains weak, with the stock trading below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling sustained bearish momentum. The breach of the 52-week low at ₹385 further intensifies downside risk, potentially triggering stop-loss orders and accelerating selling pressure.
Investor participation appears to be waning, as evidenced by the delivery volume on 31 December 2025, which stood at 77.48 lakh shares but declined by 45.53% compared to the five-day average delivery volume. This drop in delivery volume suggests reduced conviction among buyers, possibly indicating distribution rather than accumulation at current price levels.
Fundamental and Market Cap Context
ITC Ltd. remains a large-cap stalwart with a market capitalisation of ₹4,82,740.82 crores, firmly entrenched in the FMCG sector. However, its Mojo Score has deteriorated to 46.0, accompanied by a downgrade in Mojo Grade from Hold to Sell as of 29 December 2025. The Market Cap Grade remains at 1, reflecting the stock’s large size but limited recent positive momentum.
This downgrade reflects concerns over ITC’s near-term growth prospects and valuation pressures amid regulatory challenges and shifting consumer preferences within the tobacco and FMCG segments.
Just made the cut! This Mid Cap from the Heavy Electrical Equipment sector entered our elite Top 1% list recently. Discover it before the crowd catches on!
- - Top-rated across platform
- - Strong price momentum
- - Near-term growth potential
Sectoral and Peer Performance
The Cigarettes/Tobacco sector has been under pressure, with a 1-day return of -4.71%, reflecting regulatory scrutiny and evolving consumer trends away from tobacco products. ITC’s relative outperformance by 0.92% against its sector, despite a steep price fall, suggests some resilience or selective buying interest in the stock.
However, the broader FMCG sector has been volatile, with investors rotating funds towards growth-oriented mid and small caps, leaving large-cap defensive names like ITC vulnerable to profit-taking and distribution.
Liquidity and Trading Implications
Liquidity remains adequate for ITC, with the stock’s average traded value supporting trade sizes up to ₹13.91 crores based on 2% of the five-day average traded value. This liquidity facilitates institutional participation but also means that large block trades can influence price movements significantly.
The high volume on 1 January 2026, combined with a sharp price decline, indicates strong selling interest, possibly from profit-booking or repositioning ahead of the new financial year. The lack of significant recovery from intraday lows suggests limited buying support at current levels.
Accumulation vs Distribution Signals
Despite the volume spike, the decline in delivery volumes and the stock’s failure to hold above key moving averages point towards distribution rather than accumulation. Institutional investors may be reducing exposure, anticipating further downside or awaiting clearer signs of fundamental improvement.
Retail investors should exercise caution, as the technical and fundamental signals currently favour a bearish outlook. The downgrade to a Sell grade by MarketsMOJO reinforces this stance, signalling that ITC may face continued headwinds in the near term.
Holding ITC Ltd. from FMCG? See if there's a smarter choice! SwitchER compares it with peers and suggests superior options across market caps and sectors!
- - Peer comparison ready
- - Superior options identified
- - Cross market-cap analysis
Outlook and Investor Considerations
ITC Ltd.’s current market behaviour reflects a challenging environment for the stock, with technical weakness, negative sentiment, and fundamental downgrades weighing on investor confidence. The fresh 52-week low and sustained volume surge on a down day suggest that the bears remain in control.
Investors should monitor key support levels closely, particularly around the ₹380-385 range, for signs of stabilisation or reversal. Any sustained recovery above the 50-day moving average could signal a shift in momentum, but until then, caution is warranted.
Given the stock’s large market cap and liquidity, institutional moves will continue to influence price action significantly. Investors may also want to consider alternative FMCG stocks with stronger momentum and more favourable fundamental outlooks.
Summary
In summary, ITC Ltd. experienced exceptional trading volumes on 1 January 2026, coinciding with a sharp price decline to a new 52-week low. The stock’s downgrade to a Sell grade by MarketsMOJO, combined with weak technical indicators and falling delivery volumes, points to distribution and bearish sentiment prevailing. While liquidity remains robust, investors should approach the stock with caution and consider peer comparisons to identify potentially superior investment opportunities within the FMCG sector.
Only Rs. 9,999 - Get MojoOne + Stock of the Week for 1 Year (MRP = Rs. 34,999) Start Today
