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Cigarette-to-soap maker ITC on Monday reported a 10.75 per cent year-on-year growth in its standalone net profit to ₹5,572.07 crore for the third quarter this fiscal, backed by a 2.1 per cent y-o-y growth in its revenue during the period.
The diversified conglomerate had posted a net profit of ₹5,031.01 crore for the third quarter last fiscal. Gross revenue for the September-December quarter of this fiscal increase to ₹17,482.80 crore (₹17,122.15 crore), buoyed by good growth in non-cigarette FMCG and Hotels segments.
The company’s profitability also received a boost with around 30 per cent y-o-y decrease in tax expenses during period under review at ₹1,152.91 crore (₹1,646.51 crore), according to a stock exchange filing.
“The company has reassessed its provisions relating to uncertain tax positions for earlier years based on a favourable order of the Supreme Court received during the quarter. This has resulted in a credit of ₹468.44 crore in the current tax expense for the quarter and nine months ended December 31, 2023,” ITC said in a media statement.
During the quarter, revenue from the company’s cigarette business rose 3.57 per cent y-o-y at ₹7,548.75 crore, while operating profit from the segment increased 2.35 per cent to ₹4,728.07 crore during the period. The country’s largest cigarette maker said the cigarettes business witnessed consolidation on a high base after a period of sustained growth momentum.
Non-cigarette FMCG biz
During the quarter under review, non-cigarette FMCG business registered a 7.59 per cent y-o-y growth in its revenue to ₹5,209.05 crore, while the segment posted a 24 per cent y-o-y growth in operating profit at ₹431.82 crore. The company said its non-cigarette FMCG business delivered a resilient performance amidst slowdown in consumer demand. Staples, dairy, beverages, fragrances, personal wash, homecare, agarbattis, Classmate notebooks & Pens drive growth. Segment EBITDA margins expanded 100 basis points year on year to 11 per cent.
During the third quarter this fiscal, the hotels segment revenue grew 18.19 per cent year on year to ₹842.03 crore, while operating profit from the segment increased 57 per cent to ₹229.66 crore. Stellar performance in Hotels business continued with record highs in revenue and profits, the company said, adding strong growth in ARRs and occupancies witnessed across properties, driven by retail, MICE segments and marquee events like the ICC Cricket World Cup. “Segment EBITDA margin expanded 470 bps to 36.2 per cent driven mainly by higher RevPAR, operating leverage and strategic cost management initiatives,” according to the statement.
Agri-business segment revenue, however, fell 2.20 per cent year on year to ₹3,054.74 crore, and operating profit from the segment also decreased 13.34 per cent to ₹339.25 crore during the the third quarter. “The operating environment remained challenging due to various policy interventions of the government of India to ensure food security and control inflation which limited business opportunities for the Agri Business,” the company said, adding the revenue grew 14.2 per cent, excluding wheat and rice, driven by value-added agri products and leaf tobacco.
ITC board recommended an interim dividend of ₹6.25 per share for the financial year ending March 31, 2024.
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