ITC Ltd. Sees Heavy Trading Amid Price Decline and Volume Surge

Trading Activity and Price Movement

On 6 January, ITC Ltd. recorded a total traded volume of 53,595,737 shares, translating to a traded value of approximately ₹1,83,699.39 lakhs. The stock opened at ₹350.25 and reached an intraday high of ₹350.70 before sliding to a low of ₹337.75, marking a 3.42% decline from the previous close of ₹349.70. The last traded price (LTP) stood at ₹339.00 as of 14:19 IST, reflecting a day-on-day drop of 2.16%.

The weighted average price for the day was notably closer to the intraday low, indicating that a significant portion of the volume was executed near the lower price levels. This suggests selling pressure dominated the session, with buyers reluctant to step in at higher prices.

Technical and Trend Analysis

ITC’s price action remains bearish, trading below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — underscoring a sustained downtrend. The stock has now declined for four consecutive sessions, cumulatively losing 15.4% in value over this period. This persistent weakness contrasts with the broader Sensex, which fell a modest 0.37% on the same day, highlighting sector-specific challenges.

The Cigarettes/Tobacco sector, to which ITC belongs, also faced pressure, declining by 2.15%, closely mirroring ITC’s own daily loss of 2.19%. This correlation suggests that sectoral factors, including regulatory concerns and shifting consumer preferences, continue to weigh on investor sentiment.

Volume Surge and Investor Participation

Despite the negative price action, the volume surge indicates heightened investor interest. However, delivery volumes tell a more nuanced story. On 5 January, the delivery volume was 3.07 crore shares, but this figure has dropped by 45.05% compared to the five-day average delivery volume, signalling reduced long-term investor participation. This divergence between high traded volume and falling delivery volume may imply increased speculative or intraday trading activity rather than sustained accumulation.

Liquidity remains adequate for sizeable trades, with the stock’s average traded value supporting transactions up to ₹72.84 crore based on 2% of the five-day average traded value. This liquidity profile ensures that institutional investors can execute large orders without significant market impact, although the current trend suggests cautious positioning.

Mojo Score and Rating Update

MarketsMOJO’s latest assessment downgraded ITC Ltd.’s Mojo Grade from Hold to Sell on 29 December 2025, reflecting deteriorating fundamentals and technical outlook. The current Mojo Score stands at 48.0, indicating weak momentum and limited upside potential. The Market Cap Grade remains at 1, consistent with ITC’s status as a large-cap stock with a market capitalisation of ₹4,36,070 crore.

This downgrade aligns with the stock’s recent price weakness and volume patterns, signalling that investors should exercise caution. The Sell rating suggests that the stock may underperform relative to peers and the broader market in the near term.

Sectoral Context and Comparative Performance

ITC’s performance is in line with the broader FMCG sector’s struggles, particularly within the Cigarettes/Tobacco segment. Regulatory pressures, including increased excise duties and health-related restrictions, continue to challenge growth prospects. Additionally, evolving consumer preferences towards healthier alternatives have dampened demand.

Compared to the Sensex’s modest decline, ITC’s sharper fall and volume spike highlight sector-specific vulnerabilities. Investors are likely reallocating capital towards sectors with more favourable growth outlooks, further pressuring ITC’s stock.

Accumulation and Distribution Signals

The volume profile and price action suggest a distribution phase rather than accumulation. The high volume near the day’s low price, coupled with falling delivery volumes, indicates that sellers are more active than buyers. This pattern often precedes further downside, as long-term holders reduce exposure and speculative traders dominate volume.

Technical indicators corroborate this view, with the stock trading below all major moving averages and failing to find support at previous lows. Unless there is a significant change in fundamentals or sector dynamics, ITC may continue to face selling pressure.

Investor Takeaway and Outlook

For investors, ITC’s current profile presents a challenging risk-reward scenario. The stock’s sustained decline, combined with a downgrade to Sell and weak technical signals, suggests caution. While the company remains a large-cap stalwart in the FMCG space, sectoral headwinds and regulatory uncertainties are likely to weigh on near-term performance.

Traders may find opportunities in the heightened volatility and volume spikes, but long-term investors should consider the broader market context and alternative investment options. Monitoring delivery volumes and price action near key support levels will be critical to gauge any potential reversal or further distribution.

Given the stock’s liquidity and active trading, institutional players can execute sizeable trades, but the prevailing sentiment appears bearish. Investors should stay alert to any changes in sector dynamics or company fundamentals that could alter the current trajectory.

Summary

In summary, ITC Ltd. experienced exceptional trading volume on 6 January 2026, yet the stock continued to slide, hitting a new 52-week low and reflecting a deteriorated outlook. The downgrade to a Sell rating by MarketsMOJO, combined with technical weakness and falling delivery volumes, signals a cautious stance for investors. Sectoral challenges in the Cigarettes/Tobacco industry further compound the risks, making ITC a stock to watch closely for signs of either capitulation or recovery.

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