British American Tobacco Eyes Profit Boost: Plans to Sell Stake in ITC

British American Tobacco (LSE: BATS) is currently working on selling a portion of its substantial stake in India's ITC, a move that has positively influenced its stock value. This decision was driven by the company's focus on reducing debt and investing in new products, which had led to a pause in their share buyback program last year. The potential sale of their approximately 29% stake in ITC, a diversified conglomerate with interests in tobacco, hotels, and other sectors, aims to lower debt and enable BAT to resume share buybacks. The company's leadership stated that while they intend to reduce their shareholding, they also aim to retain significant influence in ITC, mentioning that a 25% stake is necessary for veto rights. This announcement was well-received in the market, as evidenced by a 7.1% rise in BAT's shares, signaling investor confidence in the company's strategic move. BAT also reported a 5.2% increase in adjusted diluted earnings per share, slightly surpassing analyst expectations.