Tobacco, agri businesses push ITC net up 18%

Sequential setback for FMCG, affecting scrip; hotel profits also dip

ITC, the diversified business conglomerate, has reported an 18 per cent increase in net profit to Rs 1,891 crore in the financial year’s first quarter, ending June 30, compared to Rs 1,602 crore in the same period a year before. Net sales for the tobacco major were Rs 7,339 crore, up 10.3 per cent in the quarter from last year. Compared to the March quarter, the final one of 2012-13, when these were Rs 8,180 crore, there was a 10.3 per cent dip due to lower agricultural exports, for seasonal reasons. Gross revenue for the quarter grew 13.4 per cent to Rs 10,727 crore.

The decade-old non-cigarette fast moving consumer goods (FMCG) business, which had a maiden profit in the final quarter of FY13, lost Rs 18.9 crore. The market reacted negatively, with the stock falling five per cent to Rs 357.25, as it had believed the segment had finally turned around. Product launches in personal care could be a reason, said an analyst. During the quarter, the personal care products business expanded with the launch of deodorants and variants of face wash and body lotion.

On a year-on-year basis, however, the company has pared losses in the non-cigarette FMCG business; it had lost Rs 38.8 crore in the quarter last year. ITC’s primary vehicle of profit generation, the cigarette business, posted a profit of Rs 2,242 crore as against Rs 1,900 crore in the period a year before, a growth of 18 per cent. Net sales from the business were Rs 3,537 crore compared to Rs 3,304 crore a year before, higher by 7.1 per cent. The hotels business continued to report a dip in profit on the back of an overall dull economy. Profits from the segment came down to Rs 8.9 crore in the quarter compared to Rs 26.2 crore last year, a fall of almost 66 per cent. Agri business jumped 16.3 per cent in profit at Rs 199.3 crore against 171.4 crore in the year-ago period.