Shares of India’s major FMCG giant ITC plunged in trade on Wednesday, after the firm reported tepid Q3 results for the latest quarter.
Shares of India’s major FMCG giant ITC plunged in trade on Wednesday, after the firm reported Q3 results for the latest quarter. ITC share price slumped by more than 4% on BSE to close at Rs 277.70. ITC has reported a 3.84% on-year rise in standalone net profit to Rs 3,209.07 crore for the third quarter ended December 31, 2018, as compared to Rs 3,090.20 crore in the comparable quarter previous fiscal.
Gross revenue from sales was up 15.09% to Rs 11,340.15 crore as against Rs 9,852.74 crore in the previous year. The profit is seen to be slightly below the Rs 3,129 crore consensus estimate of analysts tracked by Bloomberg. Cigarette business, which contributed more than 40% to total revenue, posted a strong growth of 9.6% to Rs 5,074 crore in Q3FY19. Total expenses stood at Rs 7,446.46 crore as against Rs 6,377.90 crore in the December quarter of 2017.
Notably, the firm’s hotel business saw a robust underlying growth of 29% in excluding gestation cost of new properties. “Recently commissioned hotels – ITC Kohenur and ITC Grand Goa, Resort & Spa, continue to receive excellent response from discerning guests, setting new standards in service excellence,” the firm said in a its stock exchange filing.
Paperboards, Paper & Packaging Segment continued its strong growth with net profit rising 24% driven by product mix enrichment, higher realisation, strategic investments in imported pulp substitution, process innovation leading to improved pulp yield and benefits of cost-competitive fibre chain. “Segment EBITDA at Rs. 173.38 crores posted strong growth of 42% on the back of enhanced scale, product mix enrichment and cost management initiatives, notwithstanding increase in input costs, sustained investments in brand building, gestation costs of new categories and start-up costs of new facilities,” noted the firm.