Multi-business conglomerate ITC, which has a presence in cigarettes, FMCG, hotels, paperboards and agri-produce, on Friday beat Street expectations by posting a quarterly profit growth of 20.62 per cent year-on-year at Rs 2,051.85 crore.
The growth was primarily fuelled by higher cigarette sales during the quarter as the business contributes almost 50 per cent to its overall revenues.
During the October-December period, ITC’s net sales increased 23 per cent year-on-year to Rs 7,627.07 crore.
“The stellar performance by the company is particularly remarkable when viewed against the backdrop of challenging business environment in which it was achieved, namely, a slowdown in economic growth, sustained high inflation and impact of steep hike in taxes on cigarettes during the year,” the company said in a statement.
Though the company does not give a guidance, it did point to the regime of higher taxes and control on the sale of cigarettes by various state governments.
During the quarter, ITC’s net revenue sales in cigarettes increased 13 per cent to Rs 3,657 crore, helped by the price hikes that it undertook in the last half of 2012. ITC’s FMCG business that includes biscuits, wafers, soaps and shampoos, among others, increased 30 per cent to Rs 1,783 crore. The total net revenue from the FMCG segment, including cigarettes, increased 18.2 per cent to Rs 5,440.06 crore.