ITC profit declines 7.27 pc to ₹5,013 cr in Q3 over subdued demand, surge in input costs

New Delhi, Diversified entity ITC Ltd on Thursday reported a 7.27 per cent decline in consolidated net profit to ₹5,013.16 crore for the December quarter on account of subdued demand and sharp escalation in input costs.

The company had posted a consolidated net profit of ₹5,406.52 crore in the year-ago period, according to a regulatory filing from ITC.

ITC’s revenue from operations was up 9.05 per cent to ₹20,349.96 crore in the December quarter. It was ₹18,660.37 crore in the corresponding quarter of the previous fiscal year.

The company had a “resilient performance amidst a subdued demand environment & sharp escalation in input costs”, ITC said in an earnings statement.

Key input materials as edible oil, wheat, potato, leaf tobacco, wood and packaging inputs witnessed a sharp cost escalation during the quarter, the Kolkata-headquartered firm added.

Its revenue from gross sale of products and services of ITC was ₹20,140.15 crore, up 8.74 per cent, in the December quarter.

ITC’s total expenses were 12.18 per cent higher during the quarter to ₹14,413.66 crore.

The total income of ITC, which includes other income, rose 8.47 per cent to ₹20,945.82 crore. It was ₹19,308.85 crore a year ago.

During the quarter, ITC’s revenue from the ‘total FMCG’ segment, which also includes the cigarettes business, was up 6.35 per cent to ₹14,372.53 crore. It was ₹13,513.43 crore in the corresponding September quarter.

Revenue from the cigarette business was up 7.83 per cent to ₹8,944.83 crore during the quarter of this fiscal year. It was ₹8,295.18 crore in the corresponding quarter of the previous fiscal year.

“Strategic portfolio and market interventions, with focus on competitive belts and to counter illicit trade, drive volume-led growth and reinforce market standing,” ITC said, adding that it partially mitigated cost escalation in leaf tobacco “through product-mix enrichment”.

ITC’s revenue from the FMCG-others segment was also up 4 per cent to ₹5,427.7 crore during the quarter under review. The growth in the segment was driven by atta, spices, snacks, frozen snacks, dairy, premium personal wash, homecare and agarbatti.

Its notebooks business was impacted by high-base effect and opportunistic play by local brands led by sharp drop in paper prices, the company said.

However, in the segment, ITC had a strong performance in premium portfolio and alternate channels, it said.

In the segment, it had severe inflationary pressures in prices of edible oil, wheat, maida, potato, cocoa, packaging inputs, which was partially mitigated through focused cost management initiatives, calibrated pricing actions and premiumisation.

ITC’s agri business was up 10.77 per cent to ₹3,626.01 crore in the December quarter, led by leaf tobacco and value-added agri products such as coffee, spices, etc.

ITC’s revenue from “paperboards, paper and packaging” segment was at ₹2,144.86 crore, up 3.07 per cent.

It remains impacted due to low-priced Chinese and Indonesian supplies in global markets, including India, soft domestic demand conditions and unprecedented surge in wood prices.

Moreover, “subdued realisation and surge in domestic wood prices continue to weigh on margins,” ITC said, adding that it continues to mitigate the near-term challenges in the segment through sharp focus on portfolio augmentation, export customer/market development and structural cost management interventions.

Revenue from other segments, which includes its information technology services, branded residences, etc, was up 14.25 per cent to ₹1,121.33 crore as against ₹981.4 crore a year earlier.

ITC has demerged its hotel business into a separate entity ITC Hotels Ltd.

Updating the performance of the demerged business, ITC said it also has “best-ever quarterly performance” with a strong growth of 14.6 per cent in revenue to ₹922 crore.

In a separate filing, ITC said its board in a meeting held on Thursday declared an interim dividend of ₹6.50 per share of Re 1 each for 2024-25.

Shares of ITC Ltd on Thursday settled at ₹441.40 per scrip on the BSE, down 1.53 per cent from its previous close.

This article was generated from an automated news agency feed without modifications to text.