Diversified business conglomerate ITC on Monday posted a 16.1 per cent year-on-year growth in its fast moving consumer goods segment which exceeded Rs 5,000 crore for the first time in a quarter, while its overall revenue for the April-June quarter fell 7.23 per cent year-on-year to Rs 16,995.49 crore.
“The company’s agriculture business saw bumper sales last year on account of the Russia-Ukraine crisis and wheat shortage in the country. This resulted in a high base while sales did not keep up at similar levels this year,” said Amnish Aggarwal, who heads research at stockbroker Prabhudas Lilladhar.
The conglomerate’s net profit stood at Rs 4,903 crore for the quarter, reflecting a nearly 18 per cent rise. Its total expenses during the period dropped 14.8 per cent to Rs 11,158.64 crore from Rs 13,093.30 crore a year ago.
Additionally, the brand’s board approved the acquisition of a 45.36% shareholding in International Travel House Limited and a 25% stake in Maharaja Heritage Resorts from Russell Credit Limited, according to an exchange filing.
The mainstay cigarettes division reported a 10.9 per cent year-on-year growth on the back of a stable tax atmosphere and volumes gained from illicit traders.
However, revenue from the paperboards, paper and packaging segment declined 6.5 per cent to Rs 2,121 crore.
“The paper and packaging segment remains subdued on account of detrimental macros and competitive trade environment majorly attributable to Chinese counterparts,” explained Nirav Karkera, who heads research at financial services provider Fisdom. The segment may witness weakness for a reasonably longer period ahead as well, he added.
ITC also saw its best ever Q1 business in the hotels segment with Rs 600 crore in revenues. “While nuances of the hotel business demerger seems to have dampened investor sentiments intermittently, one can expect significant value unlocking in the segment going ahead,” Karkera noted.
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