Trading Activity and Volume Analysis
On the trading day, ITC recorded a total traded volume of 11,971,323 shares, translating to a substantial traded value of approximately ₹419.52 crores. This surge in volume is noteworthy given the stock's large-cap status, with a market capitalisation of ₹4,41,144.67 crores. The stock opened at ₹350.20, touched a high of ₹353.20, and a low of ₹346.05 before settling at ₹351.85 as of 09:45 IST.
The delivery volume on 2 January 2026 was particularly significant, reaching 5.6 crore shares, marking a 23.66% increase over the five-day average delivery volume. This rise in delivery volume suggests a growing investor participation and possible accumulation phase, despite the stock trading below all major moving averages (5-day, 20-day, 50-day, 100-day, and 200-day), which traditionally indicates bearish momentum.
Price Performance and Sector Comparison
ITC's price performance on the day underperformed its FMCG sector peers by 0.37%, with the sector itself gaining 0.67%. The Sensex, in contrast, declined by 0.15%, highlighting a divergence between ITC's movement and broader market trends. The stock is currently trading just 1.81% above its 52-week low of ₹345.25, underscoring the pressure it has faced over the past year.
Despite this, ITC has shown signs of a short-term trend reversal, gaining after two consecutive days of decline. This could indicate a tentative recovery or profit-booking by short sellers, but the overall technical picture remains cautious given the stock's position below key moving averages.
Mojo Score and Analyst Ratings
MarketsMOJO assigns ITC a Mojo Score of 48.0, reflecting a cautious stance on the stock. The Mojo Grade was downgraded from Hold to Sell on 29 December 2025, signalling a deteriorating outlook based on fundamental and technical factors. The market cap grade is rated at 1, indicating limited upside potential relative to its size and valuation metrics.
This downgrade aligns with the stock's recent underperformance and technical weakness, suggesting that investors should approach ITC with prudence, especially in the context of rising volumes that may be driven by distribution rather than accumulation.
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Liquidity and Trading Implications
ITC's liquidity profile remains robust, with the stock's traded value representing approximately 2% of its five-day average traded value. This liquidity supports trade sizes up to ₹74.02 crores without significant market impact, making it attractive for institutional investors and large traders seeking to enter or exit positions efficiently.
However, the stock's current trading below all major moving averages suggests that momentum remains weak. Investors should be cautious of potential volatility, especially given the stock's proximity to its 52-week low and the recent downgrade in analyst sentiment.
Accumulation vs Distribution Signals
The surge in delivery volume combined with high traded volumes can be interpreted in two ways. On one hand, increased delivery volumes may indicate accumulation by long-term investors anticipating a turnaround. On the other, the downgrade to a Sell rating and the stock's technical weakness could imply distribution, where large holders are offloading shares amid weakening fundamentals.
Given the mixed signals, it is essential for investors to monitor subsequent trading sessions closely. Confirmation of sustained buying interest or a break above key moving averages would be necessary to validate any bullish thesis. Conversely, failure to hold above current support levels could accelerate downside risks.
Sector Outlook and Comparative Analysis
The FMCG sector has generally shown resilience, with a 0.67% gain on the day, outperforming the broader Sensex. ITC's underperformance relative to its sector peers raises questions about its competitive positioning and growth prospects. Investors may want to consider alternative FMCG stocks with stronger momentum and more favourable analyst ratings.
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Conclusion: Navigating ITC’s Current Market Dynamics
ITC Ltd.'s exceptional volume surge on 5 January 2026 highlights heightened investor interest amid a challenging technical and fundamental backdrop. While the stock has shown a minor rebound after consecutive declines, it remains under pressure, trading below all key moving averages and close to its 52-week low.
The downgrade to a Sell rating by MarketsMOJO and the modest Mojo Score of 48.0 reinforce a cautious stance. Investors should weigh the increased delivery volumes carefully, discerning whether they signal genuine accumulation or distribution by large market participants.
Given the stock’s liquidity and large-cap status, ITC will continue to attract significant attention. However, prudent investors may prefer to monitor price action closely or explore better-rated alternatives within the FMCG sector and beyond, as identified by recent comparative analyses.
Ultimately, ITC’s near-term trajectory will depend on its ability to break above key resistance levels and demonstrate sustained buying interest, factors that will be critical for reversing the current downtrend and restoring investor confidence.
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