FMCG major ITC reported over 12 per cent increase in standalone net profit at ₹2,669 crore for the fourth quarter of FY17. Net profit for the corresponding quarter in the previous fiscal was ₹2,381 crore.

During the quarter under review, total income increased 6 per cent to ₹15,411 crore (₹14,510 crore). All of its five verticals reported revenue growth.

“Overall performance was subdued reflecting the continuing tightness in liquidity, persistent weakness in wholesale channel and rural markets and sharp rise in input costs, particularly for the FMCG businesses,” the company said in a statement.

For the full year, standalone net profit stood at ₹10,201 crore, while total income was ₹57,434 crore. The company declared a dividend of ₹4.75 on every ordinary share of ₹1.

With results being mostly in line with market expectations, the ITC stock hit a 52-week high of ₹313.40 at the BSE on Friday afternoon. The stock finally closed at ₹308.65, up 2.99 per cent.

Cigarette sales Cigarettes remained the highest contributor to both revenue and profit before tax (PBT), despite flattish volume sales. For the quarter, cigarettes accounted for 60 per cent of gross revenue and 81 per cent of PBT.

There was a 5 per cent year-on-year (y-o-y) jump in cigarette revenues at ₹8,955 crore (₹8,545 crore) and PBT saw an 8 per cent rise to ₹3,259 crore.

According to a report by Edelweiss Securities, cigarette volumes remained flattish. However, cigarette volumes are expected to sustain with no negative surprise in GST rates. Cigarette margins have also improved by 107 basis points y-o-y, it added.

FMCG segment The FMCG segment, which includes branded packaged foods such as staples, snack, meals, dairy products, beverages and confectionery; apparel; education and stationery; personal care products; safety matches and agarbattis, saw an over 6 per cent y-o-y increase in revenue at ₹2,886 crore (₹2,711 crore). There was a near 30 per cent decline in PBT at ₹56 crore (₹79 crore) in this segment.

According to ITC, it witnessed a modest recovery in growth in Q4, post the impact of demonetisation in the October-December quarter.

Growth was seen in agri-commodities, branded packaged foods and personal care products business. Growth, however, was strong in the staples (led by Aashirvaad atta and Bingo), biscuits, noodles and personal care products. Education and stationery and apparel were amongst the worst hit. This led to heavy discounting in apparel and “rebalancing of inventory pipelines”.

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