Cigarettes-to-hotel conglomerate ITC Ltd posted a 20.8 per cent rise in second-quarter profit that beat estimates, driven by demand for its cigarettes and snacks.
The maker of Classic cigarettes, Sunfeast biscuits and Bingo chips reported a profit of Rs 4,466 crore ($541.18 million) for the quarter ended Sept. 30, compared to a profit of Rs 3,697 crore a year earlier.
Analysts were expecting a profit of Rs 4,368 crore, according to Refinitiv IBES data.
ITC, which has a diversified presence in sectors like snacks, hotels, speciality papers and agri-business, owns many household names like Aashirvaad Atta and Classmate notebooks.
Revenue from operations rose 26.6 per cent to Rs 17,160 crore, helped by growth in two of its mainstay segments – cigarettes and other FMCG, whose revenue rose 23.3 per cent and 21 per cent, respectively.
"Stability in taxes on cigarettes, backed by deterrent actions by enforcement agencies, enable continued volume recovery from illicit trade," the company said in a statement.
The company's hotel business saw a 81.8 per cent revenue jump, signalling a strong comeback from the impact of COVID-related curbs on travelling.
The recent easing in raw material costs could further boost earnings of diversified consumer companies like ITC, which suffered from inflationary pressures and supply chain disruptions due to the Russia-Ukraine conflict and lingering impact of the pandemic.
"Inflationary headwinds continued to weigh on consumption expenditure, which was partly offset by early onset of festive season this year in some parts of the country," ITC said.
ITC has been among the top gainers on Nifty 50 Index so far this year, with its shares rising over 60 per cent year to date.
Published 20 October 2022, 16:33 IST