ITC Ltd on Thursday announced its fiscal first quarter earnings with profit at Rs 5176.99 crore, marginally lower than Rs 5190.71 crore recorded during the first quarter of previous fiscal year. It posted revenue from operations at Rs 20,029.60 crore, up 3 per cent as against Rs 19446.49 crore recorded during the June quarter of FY24.
Gross revenue was recorded at Rs 19912.10 crore, driven by Hotels, Value Added Agri products and Leaf Tobacco. ITC said that FMCG – Others and Cigarettes delivered resilient performance amidst subdued demand conditions. While green shoots of demand recovery emerged during the quarter in the Paperboards, Paper & Packaging segment, performance remained impacted largely due to cheap Chinese supplies in international markets including India and a surge in domestic wood prices, the company said.
ITC’s Q1 performance across business verticals
FMCG- Others: ITC’s FMCG– Others segment reported resilient performance amidst muted demand conditions and extreme heatwave in parts of the country. The segment revenue posted growth of 6.3 per cent YoY to Rs 5491 crore on a high base. Growth, it said, was driven by Staples, Snacks, Dairy, Personal Wash, Fragrances, Homecare and Agarbatti. Segment EBITDA margin, meanwhile, expanded by 25 bps YoY to 11.3 per cent. Emerging channels (viz. modern trade, e-commerce, quick commerce) witnessed robust growth on the back of sharp execution of channel-specific business plans, collaborations, format-based assortments and category-specific sell-out strategies, ITC stated.
Cigarettes: The category reported net segment revenue growth of 7 per cent and PBIT grew by 6.5 per cent on-year. The conglomerate said that the differentiated and premium offerings continued to perform well under this category, while sequential improvement was witnessed in the value segment. “Sharp escalation in costs of leaf tobacco and certain other inputs were largely mitigated through improved mix, strategic cost management and calibrated pricing,” it said.
Hotels: The segment posted revenue growth of 10.9 per cent YoY with segment PBIT up 11.5 per cent on-year. The category, it said, showcased robust performance despite fewer wedding dates and extreme heatwave/elections impacting domestic travel and out-of-home dining. “Seven managed properties were operationalized during the quarter including Fortune Resort & Wellness Spa, Bhaktapur, Nepal which is the first Fortune property outside India. The pipeline of managed properties continues to be strengthened across Welcomhotel, Mementos, Storii, Fortune and WelcomHeritage brands,” ITC said. In line with its ‘asset right’ strategy, the Business has added 32 properties to its portfolio in the last 24 months.
Agri Business: The segment posted revenue growth of 22.2 per cent driven by value added agri products, leaf tobacco and wheat. ITC said that cost escalation in leaf tobacco and other agri-commodities weighed on margins during the quarter. “In line with the overall strategy of scaling-up the value-added agri portfolio, the business delivered strong growth in exports of Spices and Coffee. The Business continues to leverage the multidimensional capabilities of its state-of-the-art value-added Spices processing facility in Guntur to scale up exports,” it said.
Paperboards, Paper & Packaging: The business segment reflected the impact of low-priced Chinese supplies in global markets including India, muted domestic demand, unprecedented increase in domestic wood costs. The segment revenue declined by 6.8 per cent YoY. The business continued its sharp focus on portfolio augmentation, export customer/market development and structural cost management to mitigate near term challenges.