ITC sees broad-based growth, net profit rises 34% to Rs 4,389 crore

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ITC’s performance in the June quarter showed that business activity in all segments had returned to normal. The hotels sector recorded its greatest quarterly profit in 14 years, but cigarette tax stability allowed illegal trade volume to recover. The section for paper, paperboard, and packaging also reported record quarterly revenue and profit. Revenues for the agri and FMCG categories were at their greatest quarterly levels.

ITC said that multifaceted interventions including strategic cost management, premiumization, supply chain agility, prudent pricing measures, fiscal incentives, leveraging digital, optimising channel assortments, and a favourable business mix helped to reduce the steep increase in input costs. Revenue and profit for the company’s paperboards division increased as a result of robust demand from all end-user categories. In Q1FY23, the segment’s revenue increased to Rs 2,267.22 crore from Rs 1,582.65 crore in the same quarter last year. Pre-tax profit increased from Rs 392.83 crore to Rs 612.98 crore in one year.

Additionally, sales in the hotel sector saw a significant uptick, jumping from Rs 133.67 crore in the June 2022 quarter to Rs 580.71 crore. According to ITC, retail (packages), leisure, weddings, and MICE (meetings, incentives, conferences, and exhibitions) all contributed to ARR and occupancy levels that were higher than they were prior to the pandemic. Pre-tax profit was Rs. 116.31 crore as opposed to a loss of Rs. 159.61 crore in the prior year. The segment had reported a loss in the prior quarter as well. Wheat, rice, and leaf tobacco exports increased agribusiness revenue. The segment’s revenue for the quarter increased from Rs 4,109.82 crore to Rs 7,492.14 crore. Pre-tax profit was Rs 283.17 crore as opposed to Rs 195.04 crore in the prior year.

Story Highlights

  • The corporation credited a “strong” performance across segments for the results. Additionally, net profit and revenue increased sequentially. The preceding quarter’s net sales were Rs 16,371 crore, while the net profit was Rs 4,195.69 crore. While the company acknowledged that the trajectory of inflation remained a key monitorable, it claimed that the likelihood of a favourable monsoon and recent moderated prices for important commodities, along with the government’s and the RBI’s proactive interventions, bode well for a sustained economic recovery and increase in consumption expenditure.

  • Cigarette sales brought in Rs 7,464.10 as opposed to Rs 5,802.67 crore in the same time last year. Pre-tax earnings for the sector increased from Rs 3,461.91 crore to Rs 4,469.76 crore. In Q1FY23, the non-cigarette FMCG segment generated $4,458.71 billion in revenue, up from $3,731.40 billion in the same quarter last year. The segment’s pre-tax earnings increased from Rs 174.28 crore to Rs 206.87 crore in the previous year. Sequentially, the profit decreased.