GQG Partners Cuts 2.9% ITC Stake in ₹9,437 Crore Block Deal

GQG Partners has reduced its holding in ITC after selling shares through multiple market transactions, while a separate ₹9,437 crore block deal involving 2.9% of the company’s equity took place on October 8. The transactions put ITC shares under pressure, with the stock falling nearly 4% during Thursday’s trading session and touching a 52-week low.

The large block transaction involved approximately 36.66 crore ITC shares changing hands at an average price of about ₹257 a share. While the buyers and sellers in the block deal were not immediately disclosed, the transaction came days after GQG Partners reported a reduction in its combined holding in ITC, making the investment firm’s stake sale a key focus for the market.

GQG Partners Reduces ITC Stake

GQG Partners LLC sold around 3.97 crore ITC shares through multiple on-market transactions between May 28, 2025, and October 5, 2026.

Following the transactions, the combined shareholding of GQG Partners and persons acting in concert declined to 3.17% of ITC’s total voting capital from 3.48% earlier. The disclosure was made under Regulation 29(2) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations.

The reduction was spread across several funds associated with GQG Partners.

GQG’s ITC holding

Particular	Earlier holding	Holding after sale
GQG Partners + persons acting in concert	3.48%	3.17%
Shares sold through disclosed transactions	—	3.97 crore
Change in combined stake	—	-0.31 percentage point

The largest reduction came from Goldman Sachs Trust II — Goldman Sachs GQG Partners International Opportunities Fund, whose holding declined to 21.16 crore shares, or 1.69%, from 24.40 crore shares, or 1.95%. GQG Partners International Equity CIT also reduced its stake to 0.20% from 0.23%.

₹9,437 Crore ITC Block Deal

Separately, a massive block transaction took place in ITC shares during Thursday’s pre-open trading session.

Around 36.66 crore shares, representing approximately 2.9% of ITC’s outstanding equity, changed hands at an average price of ₹257 a share. The transaction was valued at approximately ₹9,437 crore.

The identities of the buyers and sellers were not immediately available when the transaction was reported.

ITC block deal at a glance

Metric	Details
Shares traded	36.66 crore
Equity represented	2.9%
Average transaction price	₹257
Deal value	₹9,437 crore
Date	October 8, 2026
Buyers/sellers	Not immediately disclosed

The timing of the block deal, coming shortly after GQG’s stake-reduction disclosure, triggered speculation about whether the investment firm was behind the large transaction. However, the identities of the counterparties were not officially disclosed in the initial reports, so the two transactions should not automatically be treated as the same sale.

ITC Shares Fall Nearly 4%

ITC shares came under significant pressure following the block deal.

The stock fell around 4% during Thursday’s session and touched ₹254.30, a 52-week low, according to Business Today. The decline extended ITC’s losses in 2026 to roughly 30%.

Moneycontrol reported that ITC fell nearly 3% in morning trade and was the top Nifty loser at that point. The stock had already declined for three consecutive sessions.

The selling pressure reflects the immediate impact that a large institutional transaction can have on a widely held stock.

ITC stock performance

ITC shares in 2026

Start of year       ───────────────────────── 100
October 8           ────────────────────       ~71

Approx. decline: 29%

The broader market was also under pressure on October 8, with rising global bond yields, higher crude oil prices and continued foreign portfolio investor selling adding to the risk-off environment.

GQG Has Been a Major ITC Investor

GQG Partners has been an important institutional investor in ITC.

The investment firm and its associated funds had built a sizeable position in the company, reflecting interest in ITC’s strong cash generation, cigarette business, FMCG portfolio and dividend characteristics.

The latest reduction does not represent a complete exit.

Even after the disclosed sales, GQG Partners and persons acting in concert continued to hold 3.17% of ITC’s voting capital.

The distinction is important because the transaction represents a reduction in exposure rather than a full withdrawal from the company.

ITC Has No Promoter Shareholding

ITC has an unusual ownership structure because the company does not have a conventional promoter group.

Its entire equity is classified as public shareholding.

As of June 30, 2026, several large institutional investors held significant stakes in the company. The Specified Undertaking of the Unit Trust of India held 7.78%, while Life Insurance Corporation of India held 16.3% and mutual funds collectively owned 16.5%.

British American Tobacco, through three wholly owned subsidiaries, held a 22.91% stake as of the end of June.

Major ITC shareholders

Shareholder category	Stake as of June 30
British American Tobacco entities	22.91%
LIC	16.3%
Mutual funds	16.5%
SUUTI	7.78%
Retail investors	12.5%
Promoter group	No promoter shareholding

The absence of a promoter means that large institutional transactions can receive greater attention because public shareholders collectively own the company.

Why GQG’s Sale Matters

A reduction by a large global investment firm can attract investor attention even when it does not change the company’s underlying operations.

GQG’s decision could reflect portfolio rebalancing, changes in exposure limits, liquidity requirements or its assessment of ITC’s risk-reward profile. The available disclosures do not establish a specific reason for the sale.

It is therefore important not to interpret the transaction by itself as a definitive view on ITC’s future earnings or business prospects.

At the same time, the sale adds to the near-term supply of ITC shares in the market and can affect sentiment, particularly when the broader market is already experiencing risk aversion.

ITC Faces Earnings Pressure

The block deal comes at a challenging period for ITC’s stock.

The company’s cigarette business remains its most important profit contributor, but recent changes in tobacco taxation have increased uncertainty around cigarette volumes, pricing and consumer behaviour.

Brokerage Citi recently upgraded ITC to “Buy” from “Sell” and increased its target price to ₹300 from ₹270. The brokerage nevertheless expects near-term cigarette earnings to remain under pressure following the increase in cigarette taxation.

Citi said ITC has responded through calibrated price increases and portfolio interventions.

The brokerage expects around 75% of the tax increase to have been passed through price hikes, while new products could help retain consumers within ITC’s portfolio.

Tax Changes Are a Key Risk

Tobacco taxation remains one of the biggest variables for ITC investors.

Higher taxes can push up cigarette prices and potentially affect consumption volumes. The company therefore has to balance price increases with the risk that consumers shift toward cheaper alternatives or illicit products.

The impact is particularly relevant because cigarettes remain a major source of ITC’s profitability.

At the same time, ITC has been working to diversify beyond cigarettes through its FMCG, hotels, paperboards, packaging and agri businesses.

The success of this diversification strategy is important to the company’s longer-term investment case.

ITC’s Diversification Strategy

ITC is no longer solely a tobacco company.

Its consumer-goods portfolio includes packaged foods, personal-care products and other household categories. The company also operates in hotels, paperboards and packaging and agribusiness.

This diversification provides multiple revenue streams and reduces the company’s dependence on a single category over time.

However, cigarette profitability remains highly significant, which means regulatory and tax changes affecting tobacco continue to have a substantial impact on investor sentiment.

Institutional Ownership Under Focus

The latest transaction also highlights the importance of institutional ownership in ITC.

Mutual funds and LIC together held more than 32% of the company at the end of June, while other institutions and foreign investors also maintain substantial positions.

With ITC’s stock having declined sharply during 2026, changes in institutional positioning could become increasingly important for market sentiment.

The September-quarter shareholding pattern will provide a clearer picture of how GQG’s reduction and other institutional transactions have changed the company’s ownership structure.

The Bigger Picture

The GQG stake reduction and ₹9,437 crore block deal highlight the pressure currently surrounding ITC’s shares, but they do not by themselves establish a change in the company’s underlying business outlook. GQG’s combined holding has fallen to 3.17%, but the firm continues to own a meaningful stake in the company.

For ITC, the bigger investment debate remains focused on cigarette taxation, volume trends, pricing power and the performance of its non-cigarette businesses. The stock’s significant decline in 2026 has also changed its valuation and created a different risk-reward profile for investors.

The immediate market reaction is likely to remain influenced by institutional flows, but the longer-term direction will depend more heavily on earnings and the company’s ability to navigate the regulatory environment.

Looking Ahead

Investors will closely track ITC’s September-quarter shareholding data to determine whether other large institutional investors have also changed their positions. The identities of the buyers involved in the ₹9,437 crore block transaction will also be important in understanding whether the shares were redistributed among long-term institutional holders or whether the transaction represents a broader change in ownership.

For ITC, the focus will ultimately return to its operating performance. Cigarette volumes, tax pass-through, FMCG growth, margins and the contribution of its other businesses will remain the key factors shaping the stock’s longer-term trajectory, while institutional buying and selling could continue to influence its near-term price movements.